Halaman 1 Matakuliah: J0084 / Introduction to Management and Business Tahun: 2007 Versi: 1 / 3 Pertemuan 05 (Fifth Meeting) Foundations of Planning

Halaman 2 Learning Outcome Student should be able to prove the importance of planning in every organization -> C3

Halaman 3 Learning Outline What Is Planning Why Do Managers Plan How Do Managers Plan Establishing Goals and Developing Plans Contemporary Issues on Planning

Halaman 4 1. What is Planning a. Definition of planning: Planning involves defining the organization’s goal, establishing an overall strategy for achieving those goals, and developing plans for organizational work activities b. Difference between informal and formal planning

Halaman 5 1) Provide direction 2) Reduces uncertainty 3) Minimizes waste and redundancy 4) Establishes the goals or standards used in controlling 2. Why Do Managers Plan a. Purposes of Planning:

Halaman 6 b. Planning and Performance: 1)Formal planning is associated with positive financial results as higher profit, higher returns on assets, etc. 2) Doing a good job of planning and implementing those plans play a bigger part in high performance than does the extent and amount of planning done 3) In those studies, where formal planning didn’t lead to higher performance, the external environment often was the culprit 4) The planning/performance relationship seems to be influenced by the planning time frame

Halaman 7 3. How Do Managers Plan a.The Role of Goals and Plans in Planning Goals are desired outcomes for individual, groups, or entire organizations. They also called objectives. Plans are document that outline how goals are going to be met. The plans usually include resource allocations, schedules, and other necessary actions to accomplish the goals.

Halaman 8 b. Types of Goals 1) Financial goals2) Strategic goals Continue to win market share globally Respect to the environment

Halaman 9 b. Types of Plans Breadth Frequency of use Specificity Time Frame Strategic OperationalShort term Long term Specific Directional Standing Single use

Halaman Establishing Goals and Developing Plans a.Approach to Establishing Goals 1) Traditional Goal Setting 2) Management by Objective (MB0) Four elements of MBO: a) Goal specify b) Participative decision making c) An explicit time period d) Performance feedback

Halaman 11 3) Characteristic of Well-Designed Goals: a) Written in terms of outcomes rather than actions b) Measurable and quantifiable c) Clear as to a time frame d) Challenging yet attainable e) Written down f) Communicated to all necessary organizational members

Halaman 12 4) Steps in goal Setting: a) Review the organization’s mission, the purpose of an organization b) Evaluate available resources c) Determine the goals individually or with input from others d) Write down the goals and communicate them to all who need to know e) Review results and whether goals are being met

Halaman 13 b. Developing Plans 1)Contingency Factors in Planning: a) Level in the organization b) Degree of environmental uncertainty c) Length of future commitments

Halaman 14 Strategic Planning Operational Planning Top Executive Middle-Level Managers First-Level Managers Planning in the Hierarchy of Organization

Halaman 15 2) Approaches to Planning a) Planning was done entirely by top level managers who were often assisted by a formal planning department, and a group of planning specialists b) Another approach to planning is to involve more organizational members in the process

Halaman Contemporary Issues In Planning a. Criticisms of Planning 1) Planning may create rigidity 2) Plans can’t be developed for a dynamic environment 3) Formal plans can’t replace intuition and creativity 4) Planning focuses managers’ attention on today’s competition, not on tomorrow’s survival 5) Formal planning reinforces success, which may lead to failure 6) Just planning isn’t enough b. Effective Planning in Dynamic Environments