1.1 Background of the study
1.2 Statement of problem
1.3 Objective of the study
1.4 Research Hypotheses
1.5 Significance of the study
1.6 Scope and limitation of the study
1.7 Definition of terms
1.8 Organization of the study
2.0 LITERATURE REVIEW
3.0 Research methodology
3.1 sources of data collection
3.3 Population of the study
3.4 Sampling and sampling distribution
3.5 Validation of research instrument
3.6 Method of data analysis
DATA PRESENTATION AND ANALYSIS AND INTERPRETATION
4.2 Data analysis
Long-term predictions are indispensable for planning and strategy. Yet little is known about their value, their limitations or the most appropriate way of making and using them. This paper examines these issues and proposes two approaches to long-term forecasting while illustrating their use to planning and strategy. The first approach consists of identifying and extrapolating critical long term trends while assessing their impact on society and firms. The second approach studies the analogy of the industrial and information revolutions and the specific consequences of the five most important inventions of the industrial revolution in terms of the consequences of similar ones of the information revolution. The paper concludes by advocating that much needs to be done to integrate forecasting, on the one hand, and long-term planning and strategy on the other if we want to increase the ability of organizations to anticipate important forthcoming changes, as well as their consequences, and successfully adapt themselves to these changes and the opportunities as well as the dangers associated with them.
- Background of the study
Planning and forecasting are two sides of a coin that an organization that wants to be successful must imbibe. There are needed in the achievement of an organizational goals and objectives. Planning is the process that involves going through the current activities of an organization, checking lapses that occurred in the previous year and setting measures to avoid them in subsequent years. It involves mapping out the goals an organization wants to achieve in a year, ways to achieve such goals and the necessary resources to achieve them. It is the first step a manager must take in deciding what to do and how to go about it. Planning takes an organization to where it wants to be in the nearest future. In planning, the past and present state of an organization is considered in other to bounce back better and stronger.
Forecasting involves looking into the future by noting the available resources, making an estimate of the resources required and considering if more hands will be needed in achieving the organization’s goals (Needle, 1999: p178).
Forecasting is carried out when an organization wants to look into what the future would be like; in order to put necessary measures in place. An organization can be effective if it can predict its environment, identify problems and solve them (Steiner, 1979). The most important lesson we have learned in the field of forecasting over the last two decades is that models which best fit available data (such models will be, in everyday language, the equivalent of explaining as well as possible, after the fact, what has already happened in the past) are not necessarily the most accurate ones in predicting beyond this data. This paper demonstrates that such a lesson has serious implications for other areas and notably management which is still based on the notion that future success can be attained by imitating “excellent” companies or best practices that is past success or the equivalent of model fitting. This study argues that correctly recognizing emerging changes in the business environment and accurately predicting future ones are prerequisites for future success. Recognizing and predicting such changes brings forecasting to the forefront of management and ironically turns its biggest weakness (the fact that the best model fit does not guarantee the most accurate after the fact forecasts) into a much needed strength as recognizing and predicting changes is becoming one of the most critical factors for developing foresight, formulating corporate strategies, planning effectively and in general succeeding in business.
Planning and forecasting are vital tools needed in an organization for performing management functions and in decision making to ensure all departments of the organization functions well. Corporate planning and strategy has become a popular management area since the early 1960s (Gilmore and Brandenburg, 1962; Ansoff, 1964) as the size of corporations as well as their complexity and competition were increasing. Although the early attempts concentrated on long range planning (Ackoff, 1970), later there was a shift towards corporate strategy (Ansoff, 1979; Lorange and Vancil, 1977; Malmlow, 1972; Steiner, 1979) as it was recognized that trends can change and unexpected events can occur rendering long range plans useless. Prominent among these methods and tools that became popular in the past, and which assumed that past patterns would also hold true in the future, were the Product Life Cycle Planning approach (Smith, 1980), the Portfolio Matrix of the BCG (The Boston Consulting Group, 1972), and Competitive Analysis (Porter, 1980). Porter, for instance, wrote in 1980: “Also, some firms persistently outperform others in terms of rate of return on invested capital. IBM’s return has consistently exceeded that of other mainframe computer manufacturers, for example. General Motors has persistently outperformed Ford, Chrysler and AMC.” (p.126-127) Needless to say, 15 years after the book was published, IBM and GM have lost more than $40 billion between them while Chrysler has become the star of the automobile industry. Today Porter’s statement seems outdated, if not ludicrous. Competitive analysis is useless unless the strength of future competition can be predicted. The same is true with the Portfolio Matrix (The Boston Consulting Group, 1970) and the PIMMS (Schoeffler et al., 1974) approach which assumed that the bigger the competitor and the higher his or her market share the more important his or her advantages (Wensley, 1982). Such thinking failed to see the bureaucratic disadvantages associated with bigness, or alternatively the value of being small and therefore more entrepreneurial and flexible (Kiechel, 1981). The recent excellent performance of smaller firms (e.g., Chrysler) and their ability to outperform their much bigger competitors (e.g., GM) point to the impossibility of drawing conclusions about the future by simply extrapolating what has worked well in the past. Again best model fit does not guarantee the most accurate predictions for the future. On the contrary, being different (Fierman, 1995) or even going against conventional wisdom like Sam Walton or Richard Branson may contribute more to future success than imitating the past success of excellent firms or following some alleged recipes that will improve a firm’s fortunes. Planning and forecasting walk hand in hand, as forecasting helps unify and coordinate plans.
1.2 Statement of the Problem
Organizations that fail to plan, plan to fail. Organizations that wait for rainy days are bound to crumble as this is evident in many organizations today.
Many organizations fail because of the notion that planning and forecasting should center on a part of an organization.
In addition, some business organizations crash due to poor timing of planning and forecasting.
1.2 Objectives of the Study
The major objective of this research is to discover the role of planning and forecasting in business organization.
Other specific objectives include;
- To determine if planning and forecasting should be the duty of just the managers.
- To determine if planning and forecasting boosts business organizations.
- To discover if a business organization can strive without planning and forecasting.
- To determine if there is a relationship between planning/forecasting in business organizations and Gross Domestic Product.
1.3 Research Questions
- Is planning and forecasting just the duty of the manager?
- Does planning and forecasting boosts business organizations?
- Can a business organization strive without planning and forecasting?
- Is there a relationship between planning/forecasting in business organizations and Gross Domestic Product?
1.4 Research Hypotheses
Ho: Business organizations cannot strive without planning and forecasting.
Hi: Business organizations can strive without planning and forecasting.
H02: planning and forecasting does not bust business organization
H2: planning and forecasting does bust business organization
1.5 Significance of the Study/ Justification of the study
This study is meant to bring to the knowledge of the management of business organizations that planning and forecasting is needful in the overall success of an organization.
This study will be of immense benefit to other researchers who intend to know more on this topic and can also be used by non-researchers to build more on their work. This study contributes to knowledge and could serve as a bench mark or guide for other work or study.
1.6 Scope/Limitations of the Study
This study isbroad since it is studying on the role of planning and forecasting in business organizations generally.
Limitations 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.
1.7 Definition of Terms
Plan: Is a detailed proposal for achieving something or a decision about what one is going to do.
Planning is the process of making plans for something.
Forecasting: Is the process of making predictions of the future based on past and present data and analysis of trends
1.8 ORGANIZATION OF THE STUDY
This research work is organized in five chapters, for easy understanding, as follows. Chapter one is concern with the introduction, which consist of the (overview, of the study), historical background, statement of problem, objectives of the study, research hypotheses, significance of the study, scope and limitation of the study, definition of terms and historical background of the study. Chapter two highlights the theoretical framework on which the study is based, thus the review of related literature. Chapter three deals on the research design and methodology adopted in the study. Chapter four concentrate on the data collection and analysis and presentation of finding. Chapter five gives summary, conclusion, and recommendations made of the study