LUNAR INTERNATIONAL COLLAGE

DEPARTMENT OF PROJECT
MANAGEMENT

Strategic Planning and Management

Group Assignment on “Ethiochicken”
Group Members
1. Biruk Sileshi
2. Biruk tadesse
3. Mahlet Ayenew
4. Tesfa Tsegaye
5. Alemayehu Gobena
6. Mekashaw Sisay

MSPM online SECTION 4, Group 3

August 2020
Contents
1. Introduction .......................................................................................................................................... 3
1.1. Background of the study ............................................................................................................... 3
1.2. Background of the organization........................................................................................................ 4
1.3. Methodology..................................................................................................................................... 6
2. Discussion.............................................................................................................................................. 6
3. Conclusion ............................................................................................................................................. 9
4. Suggested solutions .............................................................................................................................. 9

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1. Introduction

1.1. Background of the study

Strategic planning is the process of documenting and establishing a direction of a business by assessing
both where and How to go. The strategic plan gives a place to record our mission, vision, and values,
as well as your long-term goals and the action plans, we’ll use to reach them. A well-written strategic
plan can play a pivotal role in our business’s growth and success because it tells us and our employees
how best to respond to opportunities and challenges. On developing strategic plan there are related
issues to be considered.
The strategic planning process can take some time, but it’s beneficial for everyone involved. As the
business owner, we’ll have a better idea of the goals and objectives we want to accomplish and a path
to do that. For our employees, the process can foster an increase in productivity contributing to the
success of the business.
When we develop strategic planning, “environmental analysis is one of the methods. Successful
businesses adapt their internal environment including human and financial resources, policies,
technologies and operations to the external environment. The company performs an environmental
analysis to identify the potential influence of aspects of the general and operating environments on
business operations. This analysis identifies the opportunities and threats in a business environment in
terms of a company’s strengths and weaknesses. For example, a company may consider the impact of
operating in a communist country and the threats posed by government-controlled resources. A
company might also consider the opportunities of a government-controlled market in terms of
competing products, the implications of well-educated and well-paid consumers to product
development and sales and the impact of the location of its primary suppliers in a country in economic
crises”.[2]
A company performs an environmental analysis to gain an understanding of these strengths,
weaknesses, opportunities and threats. The environmental analysis then influences corporate planning
and policy decisions.
The second issue that is related to strategic planning is strategy formulation. Strategy formulation is
the process of determining and establishing the goals, mission and objectives of an organization, and
identifying the appropriate and best courses or plans of action among all available alternative strategies
to achieve them.

Always, there is an end in sight, and that is the organizational goals of the firm. The organization
anticipates specific results, which they can only achieve by following a specific route or acting within

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the confines or parameters of a specific framework. That route or framework will be created through
strategy formulation.

“The main reason that the strategy formulation is also referred to at times as “strategic planning” is
because they basically follow the same concept. Through strategic planning, management is able to
evaluate its resources and determine the best ways to maximize the company’s return on investment
(ROI). The output – the strategic plan – will serve as the framework or guide for the members of the
organization in carrying out their respective roles.

The third related issue is strategy implementation or executing. Strategy Implementation refers to
the execution of the plans and strategies, to accomplish the long-term goals of the organization. It
converts the chosen strategy into the moves or actions of the organization to achieve the objectives.

strategy implementation is the fourth stage of the Strategic Management process, the other three
being a determination of strategic mission, vision and objectives, environmental and organizational
analysis, and formulating the strategy. It is followed by Strategic Evaluation and Control. The process
of strategy implementation has an important role to play in the company’s success. The process takes
places after environmental scanning, SWOT analyses and ascertaining the strategic issues.

The last stage or related issue with strategy management is strategy evaluation and control, it is final
stage in strategic management is strategy evaluation and control. All strategies are subject to future
modification because internal and external factors are constantly changing. In the strategy evaluation
and control process managers determine whether the chosen strategy is achieving the organization's
objectives. The fundamental strategy evaluation and control activities are reviewing internal and
external factors that are the bases for current strategies, measuring performance, and taking corrective
actions. Having all this concept we will see one organization strategy planning management.” [3]

1.2. Background of the organization

This study is based on the company that is working on Poultry. We choose this company because it
has a huge impact in our country. The name of the organization is AGP Poultry PLC or it brand name
“Ethio-chicken”. EthioChicken is considered as one of the leading poultry producing companies in
East Africa in which the operative companies are AGP Poultry PLC (AGP), Mekelle Farms Ltd
(MFL) and Andasa Poultry PLC. These are sister companies and jointly operate under the brand
umbrella of EthioChicken. The parent company, Agflow Poultry Limited holds 100% ownership of
AGP Poultry and Andasa Poultry with 73.5% ownership of Mekelle Farms (MKF). The group focuses
on producing and selling improved breeds of chickens to smallholder farmers in rural Ethiopia.
Currently the group manages eight poultry breeder farms and two feed mill production plant in four
regions of Ethiopia and is expected to increase this number significantly in the future.

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 This company produce following products to the rural area of farmers.

1. BOVANS AND SASSO DAY OLD CHICKS- A commercial layer purely for commercial egg
production under controlled egg production infrastructure with formulated feeding regimes only.
Sasso is A dual purpose chickens that can be used for both egg and meat production under
scavenger/supplement feeding environments.

2. COMMERCIAL STARTER FEED – A Commercial Starter feed is high protein type of chicken
feed prepared to meet the dietary requirements of baby chicks. The chicken should feed starter
feed for the first 6 weeks of their life before progressing onto grower feed. The high protein content
helps young chicks grow fast into good pullets.

3. COMMERCIAL GROWER FEED

Commercial Grower feed is designed to fulfil the dietary requirements of a chicken between 6 to 20
weeks. Grower feed contains a protein content that is between 16-18% but has less calcium than
regular layer feed.
4. COMMERCIAL LAYER FEED
Commercial layer feed contains balance of protein, calcium and other vitamins and minerals that
encourages egg laying abilities in the flock. Layer feed has extra calcium compared to grower feed to
ensure that the eggshells are strong and clean. Layer feed should only be fed to chickens around 20
weeks of age or once they have started to lay eggs. But before starting layer feed mix half layer and
half grower feed from week 16 till, they start laying of 2%.

Ethiochicken has clear stated mission, vision and value.

Vision

“To bring a chicken to every family in Ethiopia in 2021, and a chicken to every person in Ethiopia
in the future, transforming the Ethiopian poultry industry, making it a model of inclusive growth”.
Mission
“To bring healthy and affordable eggs and meat to every Ethiopian family, and in doing so improve
nutrition, enhance rural farmer livelihoods, and create income opportunities for our customers and
partners”.
Purpose
“Making Farmers Healthier and Wealthier”

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 Core Values

Customer Always Comes First -We put the customer at the center of our decisions and actions.
Discipline and Accountability-We do what we say we are going to do and keep our commitments
to each other.

Think Like an Owner-We run it like we own it.

Strive for Excellence, reject “Good Enough”-We strive to be the best in the world in everything
we do.

Our Purpose Drive Us-We are driven by a deep sense of purpose.

Best Ideas Win-We debate openly and allow the best ideas to win.

1.3. Methodology

The methodology we use to gather the information about this organization was visiting their website.
And one of our group members is working in the organization and we can get information about the
organization through her by interviewing.

2. Discussion

2.1. Additional to the stated mission, vision and core values ethio-chicken also stated their
strategy on performing their business. The followings are their strategy.

➢ Understand the Rural Customer – Identifying the right product.

➢ Build Efficient Teams- Creating the pipeline for skilled labor in a country that has a
prevalent shortage of experience in the poultry sector.
➢ Establish A Distribution Model- A model that is well suited to the local chicken market
that is also proficient to scaling to millions of Ethiopians.
➢ Drive Value- We are driven by a deep sense of purpose and a commitment to building
world-class poultry business in the market we operate.
➢ Focused on Protein-we serve the rapidly growing demand for poultry products among
smallholder farmers and traditional consumers in under served geographies.

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 A strategic management theory may be said to be a supposition, proposition or a system of
ideas intended to explain the origin, evolution, principles and applications of strategic management.
Strategic management theories stem mainly from the systems perspective, contingency approach and
information technology approach to corporate management. among the common strategic management
theories noted and applicable to modern industrial and governmental organizations are the profit‐
maximizing and competition‐based theory, resource‐based theory, survival‐based theory, human
resource-based theory, agency theory and contingency theory.
“The profit‐maximizing and competition‐based theory is based on the notion that a business
organization’s main objective is to maximize long term profit and developing sustainable competitive
advantage over competitive rivals in the external marketplace. The industrial‐ organization (I/O)
perspective is the basis of this theory as it views the organization’s external market positioning
as the critical factor for attaining and sustaining competitive advantage, or in other words, the
traditional I/O perspective offered strategic management a systematic model for assessing competition
within an industry (Porter, 1981). This is tantamount to economist philosophy of business objectives.
On the other hand, the resource‐ based theory stems from the management philosophy that the resource
of firms’ competitive advantage lies in their internal resources, as opposed to their positioning in the
external environment. That is rather than simply evaluating environmental opportunities and threats in
conducting business; competitive advantage depends on the unique resources and capabilities that a firm
possesses (Barney, 1995). The resource‐based philosophy of the firm predicts that certain types of
resources owned and controlled by firms have the potential and promise to generate competitive
advantage and eventually superior firm performance (Ainuddin et al., 2007).”[1]

Ethio-chicken theories is based on profit maximizing and competition-based theory. Which means from
the companies’ mission, vision, values and strategy we can understand that the company is a profit-making
organization.

2.2. This Organization has a very good strategic planning management method. Also, there are some weakness.
based on the companies planning management let us evaluate the strategic planning management method
by the steps of strategic planning management those are: -

Step 1: Write a Vision Statement:

The weakness of the vision statement is not memorable and there are too many words that are exceeds from
the standard. The strength of the vision is it is inspiring, it has a future state and it is descriptive of the ideal.

Step 2: Write a Mission Statement:

The mission is very clear, and it answers most of the standard of developing a mission. But it does not
describe how they plan to achieve their mission.

Step 3: Perform a Gap Analysis:

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A gap analysis is a process an organization goes through to identify the gaps between its current
state and what it hopes to achieve – its vision.
To do a gap analysis, simply look at where the organization is and compare it to where it hopes
to be.
This process typically involves a step of researching data outside the organization as well as
taking a good hard look at data within the organization.
Examples of gaps an organization might look at would be:

• Market Share
• Financials
• Internal Process/Systems
• Public Relations

Customer Satisfaction and Quality of products/service (these are also considered Critical Success
Factors).
Ethiochicken vision and mission seems to revise timely, but their strategy is very generalized, it
does not include their GAP analysis. They put their strategy as a value. As per our data this
organization does not do gap analysis more often because they think that this strategy will work
every time. But the strongest part of the organization is whenever something happened to their
company, they will discuss and develop internal strategy for the specific problem.

Step 4: Write SMART Goals:

Write SMART goals for 2-3 years out (some organizations choose to go shorter or longer
depending on the organization).Goals are a wonderful thing to have but unless they are
implemented, and someone is held accountable through a structured performance management
process, they are nothing more than words on a piece of paper.
To give goals some teeth, they need to be taken down to the department and ultimately the
employee level. This means identifying who will get it done.
Ethiochicken has a SMART goal but they set the goal for five years. Which means they have a
target for sell. But this target is not taken down to the employee level. Hence their SMART goal
is in a department level. The employee has no idea about their organization smart goal.

Step 5: Monitor Progress:

Goals should be monitored at least on a quarterly basis.
This can be as simple as asking the responsible person to give a status update on their goals for
the quarter.

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It is very important that this is done because all organizations are so busy today that the day-to-
day responsibilities can sometimes get in the way of completing long-term goals.
Once a year the strategic plan and goals should be reviewed and updated to reflect current market
conditions and changes to ensure that goals are focused on the current state of the organization.

✓ Those the above lists are steps of strategic planning management but the above company
(Ethiochicken) is can't fulfil or follow all these five steps of strategic planning
management. They tried to have them all but as we see there are some weeknes in their
strategy.
✓ The background information gives clear image of the organization develops organizational
profiles to describe their product.
✓ The owner of the company is clearly set and defined.
✓ It has easily understandable vision and mission in the plan and it sets the core values of
the company as well.
✓ The companies set the product, area which addressed by its product as well.
✓ environmental analysis, strategy implementation is not clearly set by the organization.

3. Conclusion

In general, EthioChicken has a good strategic planning and management system. Which means the
company has strong strategic management staff and the company clearly stated their vision, mission,
values and strategy, as a private company in Ethiopia this company is well organized. But it has some
weakness regarding on defining proper strategy, environmental and industrial factors using PEST or
STEP (Political, Economic, Social and Technological factors).

4. Suggested solutions

o It is better to use SWOT (Strength, Weakness, Opportunities, and Threats) Matrix.

o It is better to set which strategy is their company follows whether it is corporate level
strategy, Growth strategy, Integration strategy, Diversification strategy, stability strategy
or cost leadership strategy.

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 Reference

1. Strategic Management Theory: Concepts, Analysis and Critiques in Relation to Corporate

Competitive Advantage from the Resource‐based Philosophy Omalaja M.A.*, Eruola O.A., Nigeria
UDC: 005.52 JEL: L26
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Online Library (wileyonlinelibrary.com) DOI: 10.1002/smj.2308 Received 25 June 2014; Final
revision received 25 June 2014
3. The theory and practice of strategy in (business) organizations. Jofre, Sergio Publication date:
2011 Document Version Publisher's PDF, also known as Version of record
4. Profit maximization theory, survival-based theory and contingency theory: Tengku Mohammad
Chairal Abdullah Dosen Dept. Akuntansi FE USU
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Reviewed International Research Journal Publisher: Global Journals Inc. (USA) Online ISSN:
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Theoretical Economics, 140: 195-223.
7. Porter, M. E. 1980. Competitive Strategy. New York: Free Press.
8. Porter, M. E. 1985. Competitive Advantage: Creating and Sustaining Superior Performance. New
York: Free Press.
9. Barney, J. 1991. Firm Resources and Sustained Competitive Advantage. Journal of Management,
17(1): 99-120.
10. Foss, N. J. 1996. More Critical Comments on Knowledge-Based Theories of the
Firm. Organization Science, 7(5): 519-523.
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Journal, 17: 109-122.

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 Acknowledgment

Doing this assignment has become very engaging and challenging. It also gave us to work in teams
and see the better outcome of working with team, We would first would like to thanks Our Instructor
MR. Abera Legesse for giving this course topic work and also would like to thank the Journal writers
to made us understand and elaborate strategic planning and management more and their article helped
us to work our paper. Lastly, we would like to thank the team for well collaboration.

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