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CHAPTER 6 ESTABLISHING ORGANISATIONAL GOALS & PLANS

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1 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.

2 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.

3 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.

4 (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.

5 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.

6 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.

7 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.

8 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.

9 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.

10 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.

11 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.

12 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.

13 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.

14 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.

15 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.

16 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.

17 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.

18 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.

19 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.

20 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.

21 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.

22 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.

23 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.

24 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.

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