Strategic Planning in a Turbulent Environment: Evidence from the Oil Majors
Critical Article Review
Executive Summary In Strategic Planning in a Turbulent Environment: Evidence from the Oil Majors, Robert Grant looks at the characteristics of strategic planning systems of large, multinational firms in an attempt to provide insight into whether and how companies plan. Using in-depth case studies of the planning systems of eight of the world’s largest oil companies, Plant shows that strategic planning continues to play a key role in the management systems of large companies. His analysis identifies the fundamental changes in the nature and role of strategic planning over the past two decades. In response to the difficulties faced in tumultuous and unpredictable environments, he notes that strategic planning processes have become more informal, less staff driven, and more decentralized and strategic plans have become less specific, more goal focused, and shorter term. According to Grant, the role of strategic planning systems within company management has changed too as it has become less about detailed planning and more a method for organization and performance managing. Through interviews with company personnel, he came up with three trends common to all eight companies: shortening time horizons, a shift from detailed planning to strategic direction, and increased emphasis on performance planning (Grant 2003, p. 508). Despite the successful change of strategic planning systems to unstable environments, the study shows the effectiveness of companies’ strategic planning may also have deteriorated. Evidence of this includes the limited impacts of strategic planning processes on the quality of strategic decisions and little proof that the systems were actually beneficial to strategic innovation. Critical Article Review The company I have chosen for my critical article review is Royal Dutch Shell. Using Grant’s data on Shell’s strategic planning practices during the late 1990s, I will examine how the key points of the paper relate to the
Executive Summary In Strategic Planning in a Turbulent Environment: Evidence from the Oil Majors, Robert Grant looks at the characteristics of strategic planning systems of large, multinational firms in an attempt to provide insight into whether and how companies plan. Using in-depth case studies of the planning systems of eight of the world’s largest oil companies, Plant shows that strategic planning continues to play a key role in the management systems of large companies. His analysis identifies the fundamental changes in the nature and role of strategic planning over the past two decades. In response to the difficulties faced in tumultuous and unpredictable environments, he notes that strategic planning processes have become more informal, less staff driven, and more decentralized and strategic plans have become less specific, more goal focused, and shorter term. According to Grant, the role of strategic planning systems within company management has changed too as it has become less about detailed planning and more a method for organization and performance managing. Through interviews with company personnel, he came up with three trends common to all eight companies: shortening time horizons, a shift from detailed planning to strategic direction, and increased emphasis on performance planning (Grant 2003, p. 508). Despite the successful change of strategic planning systems to unstable environments, the study shows the effectiveness of companies’ strategic planning may also have deteriorated. Evidence of this includes the limited impacts of strategic planning processes on the quality of strategic decisions and little proof that the systems were actually beneficial to strategic innovation. Critical Article Review The company I have chosen for my critical article review is Royal Dutch Shell. Using Grant’s data on Shell’s strategic planning practices during the late 1990s, I will examine how the key points of the paper relate to the
Cited: Grant, R. M. (2003). Strategic planning in a turbulent environment: Evidence from the oil majors. Strategic Management Journal, 25, 491-517. doi: 10.1002/smj.314 Shell. (2013). About shell. Retrieved from http://www.shell.com/global/aboutshell.html