CHAPTER 6 ESTABLISHING ORGANISATIONAL GOALS & PLANS © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Lecture outline The planning process The nature of organisational goals How goals facilitate performance Linking goals & plans Management by objectives © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

The planning process Mission The organisation’s purpose or fundamental reason for existence. Goal Future target or end result an organisation wishes to achieve. Plan Means devised for attempting to reach a goal. © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

(organisational efficiency The planning process Goal attainment (organisational efficiency & effectiveness) mission goals plans © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

The planning process ‘Setting goals & developing plans leads to goal attainment and ultimately, to organisational efficiency & effectiveness.’ © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Organisational mission ‘Essentially, planning builds on the organisation’s mission, the organisation’s purpose or fundamental reason for existence.’ © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Organisational mission Mission statement may: Be unwritten. Address customers, products/services, location, technology, concern for survival, philosophy, self-concept, concern for public image, concern for employees (David 1989). © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Nature of organisational goals Benefits of goals Increases performance Clarifies expectations Facilitates control Increases motivation Levels of goals Operational goals (base) Tactical goals (mid) Strategic goals (top) © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Levels of goals Top managers Middle managers 1st level managers Organisational perspective Middle managers Departmental perspective 1st level managers Unit/individual perspective strategic goals strategic plans tactical goals tactical plans operational goals operational plans © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Goals and performance Key aspects: Goal content Goal commitment Work behaviour Other process components Possible problems © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Goal content Content should be: Challenging Attainable Specific/measurable Time limited Relevant © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Goal commitment Influenced by: Supervisory authority Peer & group pressure Public display Expectations of success Incentives & rewards Participation © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Goals & work behaviour Goals & commitment affect work behaviour: Direction Effort Persistence Planning © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Goals & other process components Job process components affect performance: Job knowledge & ability Task complexity Situational constraints © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Goals & possible problems Possible problems with goals: Excessive risk taking Increased stress Undermined self-confidence Ignored non-goal areas Excessive short-run thinking Dishonesty & cheating © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Linking goals & plans Levels of plans Extent of recurring use Time spans of goals & plans Plans & innovation © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Linking goals & plans Time span of goals /plans: Levels of plans: Short Intermediate Long range Innovation supported by: Mission statement Goal content & process Planning content & process Levels of plans: Strategic Operational Tactical Recurring use: Single use Standing plans-policies, procedures, rules © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Possible obstacles to planning Environmental change Manager hostility Pressure of day-to-day work Low levels of manager skill & knowledge Domination by specialists © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Management by objectives ‘Process through which specific goals are set collaboratively for the organisation as a whole and every unit within it; the goals are then used as a basis for planning, managing organisational activities, and assessing and rewarding contributions.’ © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Management by objectives Steps in the MBO process: Develop organisational goals Establish specific goals for departments Formulate action plans Implement & maintain ‘self-control’ Review progress periodically Appraise performance © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Management by objectives Weaknesses: Needs strong, enduring commitment Requires training of managers May be misused (i.e. for punishment) Risk of dominance of quantitative goals Strengths: Helps link goals & plans Clarifies priorities, expectations Fosters organisational communication Builds member motivation © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Management by objectives MBO assessed: Can heighten organisational performance Short-term focus of US, Australian & NZ organisations limits application 20–25% success rate © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Lecture summary The planning process Major components Organisational mission statement The nature of organisational goals Benefits of goals Levels of goals Goals & performance Work behaviour Other work processes Possible problems with goals © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.

Lecture summary How goals facilitate performance Linking goals & plans Direction, effort, persistence & planning Linking goals & plans Levels, recurrent use, time spans, promoting innovation Possible obstacles to planning MBO: Management by objectives The key steps in MBO process Strengths & weaknesses © 2003 McGraw-Hill Australia Pty Ltd. PowerPoint Slides t/a Management: A Pacific Rim Focus Enhanced Edition. Slides prepared by David Meacheam & George Sansbury.