Organazational planing & descion making process

ORGANIZATIONAL

PLANNING

& DECISION

MAKING PROCESS

PESC MBA Program Organizational Planning Assignment by G1 Members 1

By Group 1 Members A Group Assignment to be Presented for management Theory & Practice Course Instructor

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Group I members

1. Sara Jemal

2. Shimelis Birhanu

3. Setegn

4. Selamawit Wolde

5. Solomon T/Markos

6. Sisay

PESC MBA Program Organizational Planning Assignment By G1 Members

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Presentation Out Line

Definition of planning

Planning Terminologies

History of planning

Types of planning

Planning Skills

Features of Good planning

SWOT & SMART Approach

Barriers & Limitation

of planning ?

Why planning fails?

Practical Experience

Sharing

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Presentation Objectives

1. Provide an overview of an organizational planning &

Decision Making activities & process.

2. Describe the purpose & future of planning

3. Identify basic required skills to develop planning

4. Identify common barriers and limitations of planning.

5. To illustrate real organizational planning practice

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1.1 DEFINATION OF PLANING

A) Basic Managerial Function


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1.1 Definition of planning Cont.…

If you fail to plan, you are planning to fail”

“If you don’t know where you are going, you’ll end up

someplace else.” Yogi Berra,

“Without the activities determined by planning, there would be

nothing to organize, no one to activate and no need to control”.

George R. Terry


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1.1 What Is planning ???

Planning is deciding in advance what is to be done in

future, when, where and by whom it is to be done.

A blueprint specifying the resource allocation,

schedules, and other actions necessary for attaining

goals.

Planning is preparation for action & its a means to an end

It is a process of thinking before doing.

1.2 PLANINING TERMINOLOGIES

Mission

Reason of Existence

Vision

A desired future state

Values

A philosophical priorities

Goal

A desired future attempts to realize

Objectives

The ends toward which activity is directed

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Strategies

A program to attain Object.

Policies

A framework for making decisions

Plan

Specifying & organizing the resource for meeting goals

Planning:

Determining org.’s goals & the means for achieving them

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1.3 PLANING HISTORY

A. Military origin

SP has its origin in warfare.

The word strategy‘ is from Greek word

strategos = stratos(army) and agein(conduct)

The word tactic also derived from Greek

Tactica = the art of disposing & maneuvering

forces in combat

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1.3 PLANING HISTORY CONT…

B. Adoption in the business world

SP introduced in 1950s

During the 1960s & 1970s it has been very famous

SP periods in business divided into three periods:

Product-orientation - 1820

Market-orientation- 1900 and

Post-industrial orientation – 1950

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1.3 PLANING HISTORY CONT…

C. Transfer to the public sector

SP entered the public and semi-public sectors during

the mid-1980s

D. Use in the education sector

SP at the central education in 1990s


1.4 Types Of Planning

1. Based on Organizational level

A. Corporate planning

B. Divisional planning

C. Sectional planning

2. Based on Focus/scope or breadth of activates

A. Strategic planning

B. Operational planning

C. Tactical planning 12

3. Based on Time period/ Duration /Time dimension

A. Long range planning

B. Medium range planning

C. Short range planning

4. Based on Dimension /Frequency of Use

A. Single Use Plans

B. Standing plans

1.4 Types Of Planning Cont.…

5. Based on the Nature of the Plan

A.Informal planning

B. Formal planning

6. Based on Area of Coverage / Objectives

A. Developmental planning

B. Economic planning

C. Administrative planning

D. Financial planning

E. Marketing plan

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7. Based on the Specificity

of the Plan

A. Directional Planning

B. Specific Planning

8. Based on Contingent Nature of the Plans

A. Crisis management plan

B. Scenario planning

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Levels of Goals/Plans Managerial Planning Involvement

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1.5 Why We Need Planning ???

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Merit Demerit

1. Reduces uncertainty

2. Ensures economical

operations

3. Facilitates control

4. Improves motivation

5. Gives competitive edge

6. Avoids duplication of efforts

1. Limitations of forecasts

2. Rigidity in administration

3. Time consuming process

4. Costly affair

5. Influence of external factors

6. Psychological factors

1.5 Why We Need Planning Cont. …. ???

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A. Organization succeed

B. Efficient utilization of resource

C. Cooperative & coordination

effort

D. Direction and sense of purpose

E. Reduce uncertainty

F. Anticipated the future

G. Source of Motivation &

Commitment

A. It used a Guides to Action

B. It serves as Standard of

Performance

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1.6 PLANNING PROCESS


1.7 FUTURES OF GOOD PLANNING

It is Based on Clearly Defined Objectives

It is Simple

It is Flexible

It is Comprehensive

It is Time-Bound

Unity and Continuous

It is Balanced, Practicable and Suitable According to the Size and form of the Business

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It uses Available Resources to

the Utmost before Creating

New Authorities and New

Resources

Participation by Subordinates

Pervasive as all the levels of

management plan

It Provides for a Proper

Analysis and Classification of

Action

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1.8 SKILLS REQUIRED FOR PLANNING

2 Basic skills are required for effective planning

1. Forecasting

2. Decision Making

1. Forecasting:

It is the attempt to predict outcomes and future trends

Internal & External factors affects forecasting process?

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1.8 SKILLS REQUIRED FOR PLANNING Cont.….

Forecasting techniques

1. Quantitative forecasting

Applying a set of mathematical rules.

2. Qualitative forecasting

Using expert judgments and opinions

3.Collaborative Planning, Forecasting, and Replenishment (CPFR) Software

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1.8 SKILLS REQUIRED FOR PLANNING Cont.…

2. 1 Decision Making Definition

“Making decisions is selecting one alternative from different alternatives”

It involves choice making


2.2 Steps In Decision Making

1. Ascertain the need for a decision

2. Establish decision criteria

3. Allocate weights to criteria

4. Develop Alternatives

5. Evaluate Alternatives

6. Select the Best Alternative

7. Putting Decision Into Action

8. Following up Decisions

Decision Making Process

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2.3 Types of in Decision Making

A. Programmed decisions:

Decision for situation faced again and again

B. Non programmed Decisions:

are used to solve nonrecurring problem.

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2.4 Decision making situations

A. Decisions under certainty

Ready made information

B. Decisions under risk:

Expected outcomes Probabilities assigned to each alternative

C. Decisions under uncertainty:

neither there is complete data nor probabilities

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1.9 DECISION-MAKING

CONDITIONS


Plan

Developed

By:

Advantages Disadvantages

Full Board

of

Directors

Ownership by leadership

Board becomes more

informed about programs

and activities

Time availability may be

limited and scheduling

difficult

May not achieve staff

ownership

Staff Clear understanding of

operation

Time flexibility

Limited board involvement

and subsequent ownership

May detract from other staff

responsibilities

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1.9 DECISION-MAKING CONDITIONS Cont.…


Plan

Developed

By:

Advantages Disadvantages

Committee Manageable size

Can include a variety of

perspectives (such as board,

staff, partners, constituents,

etc.)

Full board may not feel sense

of ownership of plan details

Board perspectives may be

excluded

Consultant Good understanding of

planning process

Should produce timely and

professional-looking plan

Limited board and staff

participation may lead to

limited sense of ownership

of plan details

Limited board leadership

development

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1.10 SMART APPROACH


Acronym Description Developing SMART Goals

S Specific . A specific goal will usually answer the five "W" questions:

What: What do I want to accomplish?

Why: Specific reasons, purpose or benefits of accomplishing

the goal.

Who: Who is involved?

Where: Identify a location.

Which: Identify requirements and constraints.

M Measureable A measurable goal will usually answer questions such as:

• How much?

• How many?

• How will I know when it is accomplished?

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1.10 SMART APPROACH CONT…


Acronym Description Developing SMART Goals

A Attainable An attainable goal will usually answer the question:

•How: How can the goal be accomplished?

R Relevant A relevant goal will usually answer the question:

Does this seem worthwhile?

T Time Bound A timely goal will usually answer the question:

When?

What can I do 6 months from now?

What can I do 6 weeks from now?

What can I do today?

R Reevaluate

Reward

Reevaluate each goal to make sure they are still relevant

and attainable.

Once goals have been accomplished, celebrate in their

accomplishment and start developing new SMART goals.

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1.11 SWOT ANALYSIS IN PLANNING


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1.11 SWOT ANALYSIS IN PLANNING CONT….


Acronym Description Basic Parameter

S Strength It Could be:

a)Technical expertise

b)Efficient human resources

c)Possession of latest physical assets

d)Strong research and development department

e)Joint venture with a Multi National Company

W WEAKNESS It is something that a company lacks.

a)Less competent staff

b)Lack of goodwill in the market

c)Obsolete plant and machinery

d)Underutilized plant capacity

e)Ineffective marketing strategies

f)Narrow product line

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1.11 SWOT ANALYSIS IN PLANNING CONT….


Acronym Description Basic Parameter

O OPPORTUNITIES It Could be:

a)To enter in a new product line

b)To expand the company’s existing product lines

c)To enter into the foreign markets

d)To acquire the rival firms

e)To create new alliances to increase competitive strength.

f)To use latest technologies in the business.

T THREATS on any undertaking:

A) New competitors may enter the field

B) Customers purchasing substitute products

C) New technology making products obsolete

D) Slow down in the market leading to slump.

E) Change in government policies

F) Shift in buyers needs and tastes

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1.12 BARRIERS TO EFFECTIVE

STRATEGIC PLANNING Cont.…

S/N Barriers to

Strategy

Formulation

Barriers to Strategy

Implementation

How to Remove

Barriers?

1 Identical procedures Lack of accountability Clear Communications

2 Strict limitations Lack of commitment Manage the Change Process

3 People Inadequate instructions

to employees

Participation of employees

in planning process

4 Emphasized

ceremonial work

Power & Influence: Regular checks

5 Limited discussion Culture Accountability

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1.13 LIMITATIONS

TO EFFECTIVE PLANING

Risky

It ends up with difference

Success and failure

Uncertainties in the future

Absence of accurate and adequate data

Complicated task

Requires patience

Requires commitment

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1.13 LIMITATIONS

TO EFFECTIVE PLANING Cont.…

Expensive and time consuming

Financial

Physical

Human

External factors

External impositions

Government intervention

Important Export policy

Taxation & labor law

1.14 WHY PLANNING FAIL ???

1. Lack of top management’s commitment

2. Staff control

3. Entrenched self-interests

4. Corporate culture.

5. Fear

6. Cynicism

7. Ignorance

8. Failing to periodically alter the plan

9. Deviation from actual objectives

10. Lack of confidence about success

11. Lack of understanding of the role in the execution process

12. Deviation from planned objective

13. Changes in responsibilities of employees were not clear

14. People are not fully rewarded for the execution of plans

15. Inadequate directions given by departmental mangers

16. Information system used for implementation is inadequate

17. Overall gals are not understood by employees

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REFERENCE

1. Marx, T. G. (1991). "Removing the obstacles to effective strategic planning." Long

Range Planning24 (4): 21-28.

2. Butler, J. E., B. Brown, et al. (2000). "Guanxi and the dynamics of overseas Chinese

entrepreneurial behavior in Southeast Asia." Management and Organizations in the

Chinese Context, Macmillan, Basingstoke: 245-268.

3. Cascella, V. (2002). "Effective strategic planning." Quality progress35(11): 62-67.

4. Al-Ghamdi, S. M. (1998). "Obstacles to successful implementation of strategic

decisions: the British experience." European Business Review98(6): 322-327.


“If you don’t know where you are going, you’ll end up someplace else.”

Yogi Berra,

THE END!!! THANK YOU!!!

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QUESTION ???

Leadership & Management

Organazational planing & descion making process