Review of the Role of Strategic Planning in Organizational Performance

Abstract

The paper covers theoretical and empirical reviews of the literature on the link between strategic planning and organizational performance. The methodology adopted for the review was to conduct extensive literature searches in the fields of strategic management in general, strategic planning and organizational performance in particular, from where relevant concepts, theories,
and empirical studies were extracted. The review identified the financial, non-financial, and balanced scorecard measures of performance, and as a management tool, strategic planning was found in several studies to influence organizational performance significantly. However, results from several other studies have shown otherwise. Perhaps for these mixed results, authors in
recent times are introducing intervening variables in their models. Theories such as the resource-based view (RBV), contingency theory (CT), and stakeholders’ theory (ST), were reviewed, but as a result of the mixed results of findings, it is apparent that variables from other disciples are needed for the model to fit. Although strategic planning is still valuable to scholars and managers alike, it has had its share of criticisms especially with regards to how it operates in various environments. The paper provided theoretical and practical implications, policy direction, and suggestions for further studies.