Mgt Theories & Pract PPT 6

8/10/2019 Mgt Theories & Pract PPT 6

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PLANNING


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Define thenature and purposes of planning.

Classify the types of goals organizationsmight have and the plans they use.

Compare and contrast approaches to goalsetting and planning.

Discuss contemporaryissues in planning.


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In formal planning, specific goals covering aspecific time period are defined.

These goals are written and shared with

organizational members to reduce ambiguityand create a common understanding aboutwhat needs to be done. Finally, specific plansexist for achieving these goals.


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First, planning provides direction to managers

and no managers alike.

When employees know what their organizationor work unit is trying to accomplish and what

they must contribute to reach goals, they cancoordinate their activities, cooperate with eachother, and do what it takes to accomplish thosegoals.

Without planning, departments and individualsmight work at cross-purposes and prevent theorganization from efficiently achieving its goals.


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Next, planning reduces uncertainty by forcing

managers to look ahead, anticipatechange,consider the impact of change, and developappropriate responses.

Although planning wont eliminate uncertainty,managers plan so they can respond effectively.

In addition, planning minimizes waste and

redundancy. When work activities arecoordinated around plans, inefficiencies becomeobvious and can be corrected or eliminated.


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Finally, planning establishes the goals orstandards used in controlling. When managersplan, they develop goals and plans.

When they control, they see whether the planshave been carried out and the goals met.

Without planning, there would be no goalsagainst which to measure work effort.


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Is planning worthwhile?

Numerous studies have looked at therelationship between planning and performance.

Although most showed generally positiverelationships, we cant say that organizationsthat formally plan always outperform those that

dont plan.


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Planning is often called the primarymanagement function because it establishes thebasis for all the other things managers do asthey organize, lead, and control.

It involves two important aspects: goals andplans.

Goals objectives) are desired outcomes or

targets. They guide management decisions andform the criterion against which work results aremeasured.


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Plans are documents that outline how goals aregoing to be met.

They usually include resource allocations,

schedules, and other necessary actions toaccomplish the goals.

As managers plan, they develop both goals and

plans.


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Stated goalsofficial statements of what anorganizationsays, and what it wants itsstakeholders to believe, its goals are.

If you want to know an organizations realgoalsthose goals an organization actuallypursuesobserve what organizational membersare doing.

Actions define priorities.


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The most popular ways to describe

organizational plans are breadth (strategicversus operational), time frame (short termversus long term), specificity (directional versusspecific), and frequency of use (single use

versus standing). Strategic plans are plans that apply to the entire

organization and establish the organizationsoverall goals.

Plans that encompass a particular operationalarea of the organization are called operationalplans.


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Long-term plans as those with a time frame

beyond three years.

Short-term plans cover one year or less. Anytime period in between would be an

intermediate plan.

Specific plans are clearly defined and leave noroom for interpretation.

A specific plan states its objectives in a way thateliminates ambiguity and problems withmisunderstanding.


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Directional plans are flexible plans that set out

general guidelines. They provide focus but dont lock managers into

specific goals or courses of action.

A single-use plan is a one-time plan specifically

designed to meet the needs of a uniquesituation.

In contrast, standing plans are ongoing plansthat provide guidance for activities performedrepeatedly.

Standing plans include policies, rules, andprocedures,


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Approaches to Setting Goals

Goals can be set either through a traditionalprocess or by using management by objectives.

In traditional goal setting, goals set by topmanagers flow down through the organization

and become subgoals for each organizationalarea.

This traditional perspective assumes that topmanagers know whats best because they see thebig picture.

And the goals passed down to each succeedinglevel guide individual employees as they work to

achieve those assigned goals


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When the hierarchy of organizational goals is

clearly defined, it forms an integrated networkof goals, or a means-ends chain.

Higher level goals (or ends) are linked to lower-

level goals, which serve as the means for theiraccomplishment.

Instead of using traditional goal setting, manyorganizations use management by objectivesMBO), a process of setting mutually agreed-

upon goals and using those goals to evaluateemployee performance.


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MBO programs have four elements: goal

specificity, participative decision making, anexplicit time period, and performance feedback.

Instead of using goals to make sure employees

are doing what theyre supposed to be doing,MBO uses goals to motivate them as well.

The appeal is that it focuses on employees

working to accomplish goals theyve had a handin setting.


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1. The organizations overall objectives and strategiesare formulated.

2. Major objectives are allocated among divisional anddepartmental units.

3. Unit managers collaboratively set specific objectivesfor their units with their managers.

4. Specific objectives are collaboratively set with alldepartment members.

5. Action plans, defining how objectives are to beachieved, are specified and agreed upon bymanagers and employees.

6. The action plans are implemented.7. Progress toward objectives is periodically reviewed,

and feedback is provided.8. Successful achievement of objectives is reinforced

by performance-based rewards.


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Managers should follow five steps when setting

goals.1. Review the organizations

mission,or purpose.

2. Evaluate available resources.

3. Determine the goals individually or with inputfrom others.

4. Write down the goals and communicate them to

all who need to know.

5. Review results and whether goals are being met.


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In the traditional approach, planning is doneentirely by top-level managers who often areassisted by a formal planning department, agroup of planning specialists whose sole

responsibility is to help write the variousorganizational plans.

Under this approach, plans developed by top-level managers flow down through otherorganizational levels, much like the traditionalapproach to goal-setting.


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Another approach to planning is to involve moreorganizational members in the process.

In this approach, plans arent handed down from

one level to the next, but instead are developedby organizational members at the various levelsand in the various work units to meet theirspecific needs.


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How Can Managers Plan Effectively in Dynamic

Environments?

In an uncertain environment, managers shoulddevelop plans that are specific, but flexible.

Although this may seem contradictory, its not.

To be useful, plans need some specificity, butthe plans should not be set in stone.

Managers need to recognize that planning is anongoing process.


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The plans serve as a road map although the

destination may change due to dynamic marketconditions.

They should be ready to change directions if

environmental conditions warrant.

This flexibility is particularly important as plansare implemented.

Managers need to stay alert to environmentalchanges that may impact implementation andrespond as needed.


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A managers analysis of the external

environment may be improved by environmentalscanning, which involves screening informationto detect emerging trends.

One of the fastest-growing forms ofenvironmental scanning is competitorintelligence, which is gathering informationabout competitors that allows managers to

anticipate competitors actions rather thanmerely react to them.


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It seeks basic information about competitors:

Who are they? What are they doing? How willwhat theyre doing affect us?

Many who study competitive intelligence

suggest that much of the competitor-relatedinformation managers need to make crucialstrategic decisions is available and accessible tothe public.

In other words, competitive intelligence isntcorporate espionage.

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Mgt Theories & Pract PPT 6