Is Strategic Planning the Right Method to Define and Implement Future Strategic Options in the UK Construction Industry?

Master's Thesis, 2011

32 Pages, Grade: A


Table of Contents

1. Introduction
1.1 Strategic Planning
1.1.1 Strategic Planning Steps
1.1.2 Strategic Planning Cycle
1.1.3 Strategic Planning Models

2. UK Construction Industry

3. Background of the Study

4. Research Objectives
4.1 Research Objective
4.2 Significance of the Study
4.3 Research Questions

5. Literature Review
5.1 Strategic Planning
5.2 Strategic Perspective
5.3 UK Construction Sector
5.4 Importance of Strategic Planning
5.5 Strategic Planning in Construction Companies
5.6 Planning and Integration in Construction Cooperatives

6. Methodology
6.1 Research Design
6.1.1 Secondary Research
6.1.2 Primary Research
6.1.3 Data analysis
6.2 Reliability
6.3 Validity

7. Potential Risks / Limitations
7.1 Risk Analysis Matrix
7.2 Risk Management Plan
7.3 Opportunities

8. Gantt Chart

9. Conclusions

10. References

Strategic Planning in the UK Construction Industry

1. Introduction

Strategic planning is a set of actions taken by the organisation, which lets the organisation analyse the situation of the company and its environment, establish goals and define the strategies, policies and procedures necessary to achieve those objectives. Strategic planning is a quintessential Strategic Management tool, seeks one or more competitive advantages in the organization and the formulation and implementation of strategies allowed to create or preserve their advantages, highlighting its’ mission and its’ objectives, and in environmental pressures and available resources (Penc, 2006; p6).

1.1 Strategic Planning

Strategic planning is an organizational management activity that is used to set priorities, focus energy and resources, strengthen operations, ensure thatemployees andother stakeholdersare working toward common goals, establish agreementaroundintended 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.

1.1.1 Strategic Planning Steps

While there is no absolute rules regarding the right framework, most follow a similar pattern and have common attributes.Many frameworkscycle through some variation onsome verybasic phases (Devanna, Fombrun, Tichy, & Warren, 2006; pp.11-17):1)assessment or analysis, where an understanding of the existing external and internal setting is built up, 2)formulation of strategy,where strategy of high level by top management is designed and a fundamental strategic plan at the organizational level is documented3) execution of strategy, where the high level plan is transformed into more action items and operationalplanning,and 4)sustainment or evaluation / management stage, where ongoing evaluation and refinement of data reporting, communications, culture, performance, and other issues of strategic management take place (Bryson, 2011).

1.1.2 Strategic Planning Cycle

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1.1.3 Strategic Planning Models

There’re a range of approaches, models, and perspectives which are applied in strategic planning. The means of devloping strategic plan is also dependent on the ledaership of the organization, its culture, size, complexity, planner’s expetise, environment, etc. For instance there’re a range of models for strategic planning that include organic, issues-based, goals-based, etc (Langford, David, and Male, 2006; Pp.51-55).

1) Organic strategic planning may begin with articulation of values and vision of organization, and then plans of action to accomplish the vision at the same time adhering to those values. A number of planners choose a particular planning approach, e.g., appreciative inquiry (Chinowsky, & Meredith, 2007; pp.1-9).
2) Issues-based strategic planning sometimes begins with examination of issues faced by the company, strategies to deal with those action plans and issues.
3) Goals-based planning is most likely the most widespread and begins with the focus on the mission of organization (and values or/and vision), goals to achieve the mission, strategies to move towards the achievement of goals, and action planning (what will be done by whom and when) (Hitt, Ireland, & Hoskisson, 2012; Pp.21-33).

2. UK Construction Industry

The art of acquiring new customers for construction industry has become the most complex business process in UK and is one which UK construction industry has to struggle every day to compete the international players leading. This process is also the most important for the development and maintenance of construction industry. The basic principle in the acquisition of new clients and maintaining the proper relationships with existing clients is very important to get the project contract. The right method to integrate the functions and processes in order to implement the strategic option is strategic planning through which long term business-client relationship can be developed and costs of processes can be reduced by its integration and re-engineering. The high standard of the work will allow building company’s reputation, which in combination with pre-marketing tools will result in new customers. Remember that the good reputation of company that works long and hard and the poor quality of the service can ruin the company’s reputation in a very short time. To sum up, the key to success in acquiring new customers is formulation of long term strategy. An effective way of long term planning for future is to plan strategically (Stabryła, 2007; p11-13).

Small and medium-sized construction companies do not have unlimited budgets which can be spent on advertising, so for them long term relationship with customers is very important and is possible only through methods of strategic planning for future development. Advertising is a very costly part of doing business. Therefore strategic planning is necessary to plan future options regarding survival in the market.

3. Background of the Study

In designing plans for management in order to achieve its set goals and objectives, the plan can be long term, medium, and short term, depends on the magnitude and extent of the organization. This equates to the company’s size, which means that various activities and plans must execute all operating units and is of lower or higher levels (Penc, 2006; p6).

It highlighted that long term planning for budget reveals the outcome of the strategic plans’ implementation; it’s believed that it’s necessary to understand and execute goals and objectives appropriately to reach the long term goals and vision of the organisation. It’s significant as well to note that the organisation must specify exactly the mission and care that goes into effect, the mission is critical, as this represents the operational functions that will run on the market. Today, strategic planning has been a tool that has changed, and ranges from planting processes and situational analysis to penetrate new markets. The stability and performance of UK construction industry is reduced increasingly and comes to the fore and situations of change, which requires a new mindset in the leadership (Langford, David, and Male, 2006; Pp.51-55).

4. Research Objectives

4.1 Research Objective

Is Strategic Planning the right method to define and implement future strategic options in the UK construction industry?

4.2 Significance of the Study

The implementation of the new changes has strongly impacted companies because sometimes companies are not prepared for a change in their business processes. Therefore, strategic planning is important for UK construction industry to support and achieve the desired competitive advantage.

4.3 Research Questions

Research questions are necessary to specify and provide guidance on how the study’s main issues can be addressed. These questions are to be answered at the end of this investigation and will be used to drawn a final conclusion from the research conducted. Following are the research questions;

1. Why strategic planning is important in enhancing the performance of construction industry?
2. What is the role of strategic planning in UK construction industry?
3. How UK construction industry can implement strategic planning?
4. Why strategic planning is right method to define and implement future strategic options in UK construction industry?
5. How strategic planning defines and implements the future strategic options in UK construction industry?


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Is Strategic Planning the Right Method to Define and Implement Future Strategic Options in the UK Construction Industry?
University of Hertfordshire
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strategic, planning, right, method, define, implement, future, options, construction, industry
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Dr Alex Cole (Author), 2011, Is Strategic Planning the Right Method to Define and Implement Future Strategic Options in the UK Construction Industry?, Munich, GRIN Verlag,


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