StrategicPlanningintheUAE

References Griffin and Pustay, Chapter 11; Rugman and Collinson, Chapter 8

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Topicsaddressed

» Whatisstrategicplanning?» SWOTAnalysisasananalyticalframework» UAEstrategiceconomicplans» Keystrategiceconomicgoals

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Strategic Planning

Strategicplanningistheprocessofevaluatinganentity’s…

» generaloperating‘environment’

» theirshort,mediumandlongertermgoals

…andthen

» formulatingaplanforthegivenentitytoachievethesegoals

Astrategicplanwilladdressquestionssuchas:

» Whatdowedo?Forwhomdowedoit?Howdoweexcel?(orhowcanwebeatourcompetitors?)

» Whatisourvisionforourorganization?Inthemediumrun?(thenext3to5years)Inthelongrun?(avisionupto20years).

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Strategic Planning in the UAE

IntheUAE,awiderangeofentitiesformulateandimplementsuchplans,examplesinclude.Theseinclude:

» UAE‐basedMNCs

» Federalgovernmentinstitutions,e.g.UAEU

» Localgovernment,e.g.AbuDhabiTourismAuthority

» ‘National’government,e.g.AbuDhabiEconomicVision2030

Formostsuchentities,thekeylongertermgoalis:

» Howtocompeteinternationallyinapost‐oilenvironment

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Steps in Strategic Plan Formulation

1. Mission / vision statement

2. Perform a SWOT analysis

3. Set strategic goals

4. Develop tactical goals

5. Have a control framework

Setsouttheentity’spurposeandcorevaluesdefinesthedesiredfuturepositionintermsofstrategicdirection

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AnexternalandinternalenvironmentalscanwhichidentifiestheinternalStrengthsandWeaknessesandexternalOpportunitiesandThreatstotheentity.

Strategicgoalsarethemajorobjectivesthegivenentitywantstoaccomplishaspartoftheoverallstrategicplan.

Tacticalgoalsandplansusuallyinvolvemiddlemanagersandfocusonthedetailsofimplementingthestrategicgoale.g.Hiringstaff,implementinginfrastructuralchanges

Processesthatensuretheentityismovingtowardsachievingitsstrategicgoals.Controlmeasuresinclude:Regularmonitoringofprogressthroughtargets,datacollectionetc.

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SWOT Analysis

SWOT isanacronymfor

» Strengths,Weaknesses,Opportunities,andThreats

» AfirmtypicallyinitiatesitsSWOTanalysisbyperforminganexternalandinternalenvironmentalscan

Internalscan

» Strategicplannersassesstheinternalenvironment,thatis,thegivenentity’sstrengths andweaknesses (theSandWinSWOT).E.g.whataretheentity’scorestrengths,keyskillsandresources– inwhatwaysareitscompetitorsmoreproductiveorinnovative.

Externalscan

» Strategicplannersconsidertheexternalenvironment,theyidentifybothopportunities (theOinSWOT)andthreats (theTinSWOT)E.g.shrinkingmarkets,increasingcompetition

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SWOT analytical framework

SWOT asabusinessanalyticalframework

» StrengthsandWeaknessesareinternal,theyareanassessmentoftheorganization'sresources,capabilitiesandcorecompetencies:

» FinancialIssues,e.g.budget,Technologicalissuese.g.adoptionofIT,Humanresourcese.g.employeetraining,Intangibleresourcese.g brand

» OpportunitiesandThreatsconsidertheexternalenvironment,includingthepolitical,economic,socialandtechnologicaltrends.

» Listthebusiness’skeyinternalstrengthsandweaknesses,externalopportunitiesandthreatsinaSWOTmatrix

» DevelopeachpointintheSWOT,providingevidenceandthendrawconclusionsandmakerecommendations,e.g.howtodefendagainstthreats?Howtoexploitopportunities?

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Pros and Cons of SWOT

Someadvantagesofthisframeworkinclude:

» Simple‐ Itsimplementationdoesnotrequiretechnicalknowledgeandskills.

» Flexible‐ SWOTanalysisallowsthesynthesisandintegrationofvarioustypesofinformation.

Somelimitationsofthisframeworkinclude:

» Subjectiveanalysis– (compilerbias)thereforepointsmustbebackedupwithevidence,dataandinformation.

» Staticanalysis– providesastaticassessmentatonepointintime.

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TheSWOTanalyticalframeworkcanbeappliedatamacroormicrolevel:

1. Atthenationallevele.g.ASWOTanalysisofglobalisationfortheUAE

2. Atthelocallevele.g.ASWOTanalysisforAlAin

3. Atthesectoriallevele.g.ASWOTanalysisoftheUAE’sbankingsector

4. Atthecompany/institutionallevele.g.ASWOTanalysisforEmiratesAirlines

See for example additional reading materials on Blackboard: SWOT-analysis-example-Emirates-airline.pdf

SWOT Analysis

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TheGovernmentofAbuDhabirecentlypublisheditslong‐termstrategiceconomicgoal,it’svisionisto:

“Toachieveasafeandsecuresocietyandadynamic,openeconomy”

Thekeyorganisationsinvolvedinthestrategicplanare:

Abu Dhabi’s ‘Economic Vision 2030’

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Abu Dhabi’s Strategic Goals

» TheUAEisactivelyseekingtodiversifyitseconomy.Thiswill:

» meanthattheUAEwillbecomemoregloballyintegrated

» However:whilethiswillcreateopportunities forsomeUAEbusinessesitwillrepresentthreats toothers

Source: ABU DHABI STRATEGIC PLAN, 2030

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Abu Dhabi’s Strategic Goals

Source: gsec.abudhabi.ae, 2010

For more details see additional reading materials on Blackboard: Abu Dhabi-Economic-Vision-2030.pdf

» AbuDhabiwantstoachievehigherglobalcompetivenessrankings

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The ‘New’ Economy – Dubai

Source: DUBAI STRATEGIC PLAN, 2015

Economic development and diversification are cornerstones of the Dubai Strategic Plan 2015, a policy document that builds on the emirate's past successes and charts the course forward for this city, which is already the centre of business, trade, tourism and finance in the region...

The Strategic Plan’s economic development goals build on these assets and seek to solidify Dubai’s region and global position...

Dubai’s strongest sectors will lead this growth: travel and tourism, banking and finance, professional services, transport and logistics, trade industry and construction.

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Economic Outlook

ECONOMIC DIVERSIFICATION IS KEY

BoththeAbuDhabiandDubaigovernmentsconsidereconomicdiversificationtobeacriticalpartoffuture economicplanning

Thiswill(a) diversifyfutureincomestreamsand(b)providethesortsof‘privatesector’employmentopportunitiesthatEmiratisaremorelikelytoconsiderasaviablealternativetoa‘governmentjob’.

AttractingmoreFDI and‘technicalknow‐how’willrequireanevengreaterengagementwiththeglobaleconomyandincreasingthecompetitiveadvantageorattractivenessoftheEmiratesasabusinessdestination.

Nonethelessincreasedglobalcompetitionwill‘threaten’someinefficientUAEbusinesses– tosurvivetheywillneedtobemoreproductiveandadoptthelatesttechnologies.