1. Management Activities
Planning
Organising
Controlling

2. Planning
This is the process of setting goals and objectives and deciding how to achieve them.
Examples of plans include strategic (long term), tactical (short term) and contingency plans (emergency plans).
Planning is vital in business. Failing to plan is like planning to fail.

3. Mission statement
A mission statement is the overall fundamental objectives and purpose of the business, the reasons for its existence and what it sees for itself in the future.
The purpose of a mission statement is to help each member of staff to stay focused on the organisations main aim.
It is prepared by the board of directors.
It is a short and precise statement explaining who we the business are and what they do.

4. Types of plans 1. Strategic plans Also known as long term plans
They are developed over the long term and normally cover five years or more
They are drawn up by senior management and focus on the organisations mission or purpose.
They provide a guide for where the business is going in the long term and how it’s going to get there.

5. 1. Strategic Plan contd
Strategic planning requires an examination of the organisations strengths, weaknesses, opportunities and threats so that the objectives can be achieved.
Examples:
Achieving entrance into a new/foreign market
Achieving an increase in market share
Becoming a market leader

6. 2. Tactical plans
The long term plan is broken down into more manageable short term plans.
Short term plans relate to a particular function of the organisation ie)advertising.
They cover a period of about 1-2 years and are developed by a management team which deals with getting the work done to carry out the strategic plan.
Examples
Launch a new advertising campaign aiming to increase sales by 10%
Open a new branch of the business
Reduce employee turnover
Launch a new product

7. Airline Example Mission : To become the biggest airline in the world.
Strategic Plan : To operate 20% of all flights from Europe to the US within the next five years.
Tactical Plan: To launch flights from Dublin to New York in the next 6 months

8. 3. Contingency Plan
These are special plans prepared to deal with unexpected circumstances or emergencies.
Most well managed firms have contingency plans ready to deal with unexpected situations such as:
A breakdown in production
A disruption in supply of essential raw materials.
Bankruptcy or bad debt of a large customer
Quality control errors requiring the recall of faulty goods already sold

9. 4. Operational Plan This is a short-term plan for a specific event.
To organise an event like a concert.
To recruit more staff within one month for Christmas

10. The steps in the planning process
Carry out a SWOT analysis to analyse the present situation.
Set objectives
Devise strategies
Implement plan
Review

11. What are the stages in the planning process?
Step 1 Analyse the situation-where are we now
Step 2 Identify the goal-where do we want to be
Step 3 Draft a plan-how will we get there?
Step 4 Implement it-Do it.
Step 5 Review it- Are we there yet
1.Decreasing sales
2.Increase by 10%
3.Improve product Quality, launch advertising campaign
4.Design add for TV,radio
5.Monitor any changes in sales to see if plan worked

12. What are the stages in the planning process?
Step 1 Analyse the situation-where am I now
Step 2 Identify the goal-where do I want to be
Step 3 Draft a plan-how will I get there
Step 4 Implement it-Do it
Step 5 Review it-Am I there yet
Sitting in
Arrive in Passport Office in
Take the 8.30 am train to Dublin
Buy ticket & board train
Passport Office in sight???

13. Step 1-Ananlyse the situation
The first step in planning is to analyse the situation facing the business. This done by carrying out a SWOT analysis. This involves identifying the strengths, weaknesses, opportunities and threats.
The aim of a swot analysis is to maximise the potential strengths and opportunities while minimising the impact of threats.

14. Strengths
Strengths – the things the company are good at or important assets that give the company a competitive advantage. A firm should take advantage of these
Examples:
Location
experienced/skilled staff
experienced management
loyal customers
brand name
Quality product
Adequate cash flow

15. Weaknesses
Theses are the things that the business lacks or things that make it difficult for the business to achieve its objectives or puts it at a competitive disadvantage to other firms. Weaknesses should be tried to be fixed/remedied as quickly as possible.
Examples
poorly trained staff
poor public image
industrial relation issues
Weak credit control
Lack of capital
Costs too high
Lack of experience

16. Opportunities
These are the things the business can take advantage of in the future. They offer the possibility of assisting or expanding the business and should be exploited as soon as possible.
Examples
To export
To enter new markets
to expand
To reorganise the factory
To introduce new uses for product

17. Threats
These could undermine the well being and profitability of the firm. They prevent the firm achieving its objectives and may pose problems in the future. The business should be defended against as soon as possible.
Examples include
New competitors
Rules and regulations
Bankruptcy
Takeovers
Rising wage/insurance costs

18. Step 2: Set Objectives
The business should use the results of the SWOT analyses to help set its objectives. (i.e. they will try to strengthen/remedy their weakness and exploit their opportunities and defend against their threats.)
Objectives are goals the business wants to achieve. i.e. An Aer Lingus SWOT analysis revealed a major weakness that its costs were too high and it was losing money. A major threat was competition from Ryanair. It then set itself the objectives of cutting costs and becoming a low fare airline.

19. Step 3: Devise Strategies
Once the objectives are set the business now must come up with strategies to achieve the goals.
E.g.) Aer Lingus came up with the strategy of making 2000 employees redundant in order to achieve its goal of cutting costs.
Three Basic Strategies
Low Cost Leadership Ryanair, Lidl
Differentiation ….. Use branding
Niche strategy…luxury niche, Ferrari.

20. Step 4: Implement the Plan
The plan must be put into action. The manager must break down the plan into manageable jobs and give each person in the business a job to do.
It is important to communicate the plan to all employees in the organisation. This ensures that the employees back the plan and try and make it work.
HW Page 127 No 4 (blue section/top of page)

21. The Qualities of a Good Plan “S M A R T”
Specific
Measurable
Agreed
Realistic
Timed

22. SMART
Specific- they must be clear and precisely expressed/quantifiable
Measurable-the success of the plan should be easily measured
Agreed the plan must be agreed by all the management team
Realistic- the plan must be capable of being achieved with the resources (human, financial and physical) available
Timed-there must be a timescale for achieving the objectives

23. Advantages of Planning
1.Future focused
When planning managers try to anticipate problems hat may arise or are facing the business in the future. This enables them to take necessary steps now to deal with those future problems.
Eg. A man power plan
2. Planning identifies the business’s weaknesses.
A SWOT analysis is conducted and this identifies the weaknesses, which helps a business to see what it does badly or things that it is lacking and then can take steps to eliminate these.

24. Advantages 3. Raise finance
A good Business Plan will convince investors that the Business is a sound one and is likely to be successful. Good planning persuades investors to provide the business with capital.
4.Motivates staff.
Plans set out objectives for the employees and managers to achieve within a given timeframe. Everyone on the business has a target and when it is reached they will be rewarded, therefore they are motivated to work hard.