Strategic Planning At Local Companies

Prepared byAhmed RashadGhada GamalKholoud HossamNesreen GawishOla SadekYosra Assaker

Introduction• There is no single “best practice” for how to do successful

strategic planning. • The timing and process will differ depending on industry,

market pressures, and the size and culture of the business.

• Data for the following presentation was collected from the discussions with planning manager for EGAS company and the ex-quality manger of RAMEDA company in addition to literature survey for the two companies.

Egyptian natural gas holding company (EGAS)

• It is a public sector Company that represents the governmental authority in dealing with all natural gas activities in Egypt.

• EGAS is engaged in a wide range of activities, including : 1. Upstream : Exploration, Drilling and Production of natural gas. 2. Downstream : Processing, Transmission, Distribution of natural

gas in the domestic market and liquefied natural gas.

Vision

Develop natural gas business in Egypt to be one of the key natural gas players in the region and worldwide.

Mission

Operate with integrity to improve HSE performance and increase the staff & contractors awareness.

Maintain a strategy of innovation and growth. Continue issuing Bid Round, signing Concession Agreements and applying

applications of state of art technology in all Exploration processes. Increase natural gas proven reserves to meet all obligations that fulfill local

market demand and export commitments. Increase Annual Production to manage Supply Vs. Demand requirements. Create Infrastructure and optimize Facilities Utilization. Project Management aiming cost optimization and effective schedule. Maximize applying the Value Added Projects. Establishing new specialized companies in the area of Drilling, Engineering &

Marine vessels. Expand Egyptian Natural Gas Grid to meet the targeted projects and

develop new communities

Who participates in the strategic planning process

• Mission, vision and strategy formulation is done by the

board of directors , which is formed of nominated

experts in the field of oil and gas, including the chairman

of the company and some of the vice chairmen , and the

chairman of relevant authorities ; example , the

chairman of Egyptian general petroleum corporation ,

Ganoub el wadi holding company, representative of

ministry of finance ,…etc.

Strategy formulation process

• The strategic planning starts by collecting data from each department (which is collected from different subsidiary companies), including capacities of work in each sector, priorities according to urgent opportunities /threats, and several different plans to respond to them.

• Then the proposed plans are merged together (some approved, rejected or rescheduled) according to compliance with government priorities / policies, and available resources (funding/availability of gas / security requirements / social aspects/…etc.) then general objectives are derived.• Note : Although the corporate is an independent company, yet it

is considered as a business unit in the Ministry of petroleum which is a part of the whole Government .

• A strategy is formulated to meet such objectives.• Discussions then take place between the board and the top

management of different activities in the company to perform further planning (detailed plans of each business unit).

Strategy formulation process

Data

colle

ction

Cascading of plans

Business units & Subsidiary companies

Top management

BOD

External Factors: Opp. / threats

Ex.: Gov. policies/ security / Funds/

international relations/ political

factors

Internal Factors: Strengths/ weaknesses

Ex.: Authority/Budget/ HR capabilities/

Technology /working CapacityPlanning

Department

Benefits of the current process of strategic planning

• The presence of a strategic plan lead to the synchronization of efforts, collaboration of all business units and an optimum resource allocation which served the achievement of the company’s strategic objectives, example:• Gas connection to households and factories ; achieved around

650 000 household in the year 2013/2014.• As a strategic objective, all the departments had this project as a

priority , financial resources were provided, no. of calibers (engineers and technicians) were increased, legal regulations were made more flexible in practice , top management were involved many times to facilitate any emerging obstacles instantly.

Analysis and comments

1- Several stakeholders are not represented in the strategy formulation process:•Customers (local / foreign).•Suppliers .•Partners.•Community (to consider : safety / environment / employment concerns).

2- the strategy of the corporate is influenced by the government whole strategy , as it is considered a business unit of the government.

3- the framework of the strategy formulation process is not firmly organized ; ex. scheduled reviewing, documentation of findings and discussions, criteria of experts to contribute ..etc.

Analysis and comments

4- external and internal assessment is not performed in a written, documented way and it is left for the board members assessment (as they are considered to be experts in their field), this sometimes result in:• Effect of perception of the experts involved can hide some facts.•Missing the recorded documentation of the brain –storming sessions , that can help in future evaluation of the strategy; ex: who were consulted, what was their thoughts ,..etc.•The absence of SWOT analysis can drop some important factors that should be taken into consideration , or can distort the relative weight given to each factor.

Rameda pharmaceuticals

• Rameda is a modern pharmaceutical company, manufacturing and marketing a wide range of high quality pharmaceutical products, based on its own development as well as cooperation with multinational companies.

Vision

To become the most valuable emerging pharmaceutical company in Egypt.

Mission

To provide our customers quality health care solutions in a cost effective manner by developing products and services that satisfy their health requirements.

Who participates in the strategic planning process

• Mission, vision and strategy formulation is done by the board of directors lead by the chairman ( which is different from the CEO), each division in the company is represented in the board (functional managers) and participates in establishing the framework for the best way each division will support Rameda’s Strategy.

Strategy formulation process

• The company annually performs wide assessment involves the following areas:

1-Current internal factors affecting the company.2-Performance evaluation.3-Quarterly financial review.4-perform external scan: social, Competition, Economic, Political, Technology, Industry and customer.

This assessment is performed through Rameda Academy which utilizes the expertise of both in-house and outsourced highly specialized industry professionals and instructors.

• Board of directors establishes a ten year vision for the company's long term future and compare that vision with current status.

• They set clear goals (measurable and comprehensible to everyone) and these goals are equally meaningful to internal and external stakeholders.

• Then a strategic plan is set to achieve these goals.

Declared strategy

• As stated by the Quality management division:

Our branding strategy focuses on protecting and promoting Rameda through differentiating it from all other companies. We believe that our brand has a unique story which we portray through all our communication channels conveying the following:

High quality manufactured products

Patient Centricity

Patient Broad Accessibility

Affordable Prices

Wide & diversified products for diverse therapeutic areas

Better treatment outcomes than other generics

Benefits of such current strategic planning

Rameda exports a wide range of approximately 55 medicines that range from standard generics to value-adding molecules to Libya, Sudan, Ethiopia, Yemen, Uganda, Saudi Arabia and Iraq.

due to Rameda’s successful strategy of gaining competitive advantage by forming collaborations it has entered into an agreement of partnership with Alcon* to manufacture – under license - their ophthalmology products. * Alcon incorporated and with corporate headquarters, in Switzerland, is a global

medical company specializing in eye care products.

Analysis and comments

Rameda has an organized well documented strategic planning process and its strategy is implemented through clearly communicated plan, active participation, and accountability of all members across the organization which lead to the success previously mentioned .But that was not the case when the company first started, This improvement in Rameda’ performance happened due to the recent major changes in upper management at 2011 (Rameda hired a new management team with a proven track record to complement the existing team), a team who paid enough attention to the best practices that starts by strategic planning.

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