1. PLANNING
Management Concepts

2. Planning Primary function of management
Prerequisite of effective management
Making decisions regarding what to do, when to do, where to do, who is to do and how to do
Blueprint for future course action
Planning – Process Plan- outcome
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3. What is planning
Identifying and selecting appropriate goals and courses of action for an organization.
The organizational plan that results from the planning process details the goals and specifies how managers will attain those goals
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4. Contd/- To perform the planning task, managers:
Establish where an organization is at the present time
Determine its desired future state
Decide how to move it forward to reach that future state
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5. Features Primary function Adaptive to environment Future oriented
Goal oriented
Pervasive
Intellectual process
Efficient
Flexible
Involves decision making
Feedback
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6. Advantages of Planning
It gives direction to managers and nonmanagers alike.
Planning can reduce the impact of change.
It minimize waste and redundancy.
Planning establishes objectives or standards that facilitate control.
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7. Disadvantages of Planning
Planning may create rigidity.
Plans can’t be developed for a dynamic environment.
Formal plans can’t replace intuition and creativity.
Planning focuses managers’ attention on today’s competition, not on tomorrow’s survival.
Formal planning reinforces success, which may lead to failure.
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8. Making plan effective Climate for planning Clear cut Objectives
Management Information System
Careful premising
Top management Support
Participation in planning
Sound Communication
Integration of Plans
Open systems approach
Cost benefit analysis
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9. Planning Encompasses:
Defining the organization’s objectives or goals.
Establishing an overall strategy for achieving those goals.
Developing a comprehensive hierarchy of plans to integrate and coordinate activities.
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10. Essentials of a sound plan
Should be based on clearly defined objectives
Simple and understandable
Flexible or adaptable to changing conditions
Balanced in all respects and should be reasonably comprehensive
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11. Contd/-
Should provide standards for evaluation of performance and actions
Should be practicable and action oriented
Should be prepared with the consultation of concerned persons
Different plans must be properly integrated and harmonized with one other
Should provide for proper analysis and classifications of actions
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12. Elements of Planning Goals (also Objectives) Plans
Desired outcomes for individuals, groups, or entire organizations
Provide direction and evaluation performance criteria
Plans
Documents that outline how goals are to be accomplished
Describe how resources are to be allocated and establish activity schedules
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13. Managers Planning -Process
Step 1 Situational Analysis
Step 2 Alternative Goals and Plans
Step 3 Goal and Plan Evaluation
Step 4 Goal and Plan Selection
Step 5 Implementation
Step 6 Monitor and Control
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14. Decision Making Stages and Formal Planning Steps
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15. Steps in Goal Setting Review the organization’s mission statement.
Do goals reflect the mission?
Evaluate available resources.
Are resources sufficient to accomplish the mission?
Determine goals individually or with others.
Are goals specific, measurable, and timely?
Write down the goals and communicate them.
Is everybody on the same page?
Review results and whether goals are being met.
What changes are needed in mission, resources, or goals?
Management Concepts

16. Developing Plans Manager’s level in the organization
Strategic plans at higher levels
Operational plans at lower levels
Degree of environmental uncertainty
Stable environment: specific plans
Dynamic environment: specific but flexible plans
Length of future commitments: current plans affecting future commitments must be sufficiently long-term to meet those commitments.
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17. Types of Plans Breadth Time frame Specificity Frequency of use
Strategic
Long term
Directional
Single use
Tactical
Short term
Specific
Standing
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18. Hierarchy of Goals and Plans
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19. Management Concepts

20. Strategic and Tactical Plans
Strategic plans are plans that apply to the entire organization, establish the organization’s overall objectives, and seek to position the organization in terms of its environment.
Tactical plans (sometimes referred to as operational plans) specify the details of how the overall objectives are to be achieved.
Strategic and tactical plans differ in three primary ways—their time frame, scope, and whether they include a known set of organizational objectives.
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21. Strategic Planning Strategic planning Strategic goals
A set of procedures for making decisions about the organization’s long-term goals and strategies
Strategic goals
major targets or end results that relate to the long-term survival, value, and growth of the organization.
Management Concepts

22. Strategic Planning Where will we be active? How will we get there?
How will we win in the marketplace?
How fast will we move and in what sequence will we make changes?
How will we obtain financial returns
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23. Tactical and Operational Planning
Tactical planning
A set of procedures for translating broad strategic goals and plans into specific goals and plans that are relevant to a distinct portion of the organization, such as a functional area like marketing.
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24. Tactical and Operational Planning
The process of identifying the specific procedures and processes required at lower levels of the organization.
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25. Short-term and Long-term Plans
Short-term plans are plans that cover less than one year.
Long-term plans are plans that extend beyond five years.
Their differences lie in the length of future commitments and the degree of variability organizations face.
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26. Specific and Directional Plans
Specific plans have clearly defined objectives and leave no room for misinterpretation.
Directional plans are flexible plans that set out general guidelines.
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27. Single-use Plans
Single-use plans are used to meet the needs of particular or unique situation. Developed for a one-time, nonprogrammed issue.
Programs: integrated plans achieving specific goals.
Project: specific action plans to complete programs.
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28. Standing Plans
Standing plans are ongoing, and provide guidance for repeatedly performed actions in an organization. Use in programmed decision situations
Policies are general guides to action.
Rules are formal written specific guides to action.
Standard operating procedures (SOP) specify an exact series of actions to follow.
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29. Scenario Planning Scenario Planning (Contingency Planning)
The generation of multiple forecasts of future conditions followed by an analysis of how to effectively respond to those conditions.
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30. Management by Objectives (MBO)
A comprehensive management system based on measurable participatively set objectives that leverages the motivational power of objectives.
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31. Objectives
An objective is a firm commitment to achieve a measurable result within a specified period.
Emphasis on four aspects:
Goal
Definiteness
Scope
Direction
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32. Writing Good Objectives
Objectives should be expressed in quantitative, measurable, and concrete terms.
What specific result is to be achieved?
When is the result to be achieved?
How the result is to be measured?
Who will be responsible for achieving the result?
Management Concepts

33. The Importance of Objectives (Uses of)
Targets: sets specific goals to achieve.
Measuring sticks: gages how much was achieved.
Commitment: encourages pursuit of the objective.
Motivation: provides a challenge for achievement.
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34. What Is MBO?
MBO is a system in which specific performance objectives are jointly determined by subordinates and their supervisors, progress toward objectives is periodically reviewed, and rewards are allocated on the basis of that progress.
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35. Features of MBO Participation Integration
Links Objective to performance
Continuity
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36. The Common Elements in a MBO Program
Commitment
Goal specificity
Participative decision making
Top management support
An explicit time period
Performance feedback.
Autonomy
Review
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37. Objectives of MBO
Promotes subordinate’s participation in the goal setting process
Facilitates fast and effective decision making
Coordinates individual goals with organizational goals
Improves communication amongst managers and subordinates
Serves as the basis for control by setting objective standards of performance
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38. Steps in a Typical MBO Program
The organization’s overall objectives and strategies are formulated.
Major objectives are allocated among divisional and departmental units.
Unit managers collaboratively set specific objectives for their units with their managers.
Specific objectives are collaboratively set with all department members.
Action plans, defining how objectives are to be achieved, are specified and agreed upon by managers and employees.
The action plans are implemented.
Progress toward objectives is periodically reviewed, and feedback is provided.
Successful achievement of objectives is reinforced by performance-based rewards.
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39. Cascading of Objectives
Overall organizational objectives
Divisional objectives
Departmental objectives
Individual
objectives
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40. How does a manager set employee objectives?
Identify an employee’s key job tasks.
Establish specific and challenging goals for each key task.
Allow the employee to actively participate.
Prioritize goals.
Build in feedback mechanism to assess goal progress.
Link rewards to goal attainment.
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41. Contd/- Reason for MBO Success
Top management commitment and involvement
Helps in setting realistic goals
Helps in making planning effective
Helps in creating effective communication network
Improves employer-employee relationship
Facilitates control
Basis of change
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42. Potential Problems with MBO Programs
Not as effective in dynamic environments that require constant resetting of goals.
Overemphasis on individual accomplishment may create problems with teamwork.
Allowing the MBO program to become an annual paperwork shuffle.
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43. Potential Problems
Employees tend to focus on the goals by which they will be judged.
Specific goals encourage individual achievement rather than a team focus.
Specific goals may have a tendency to limit employees’ potential and discourage efforts for continuous improvement.
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