1. Managing the Planning Process
Chapter 5
Managing the Planning Process

2. Example of a “Manager” as Planner
Blackhawk Down

3. Learning Objectives After reading this chapter, you should be able to:
Identify the different elements of an effective plan.
Analyze the advantages and disadvantages of planning, and identify how planning pitfalls can be avoided.
Distinguish between formal and informal planning.
Recognize the features of well-designed objectives.
Identify the various types of action plans that managers can use to accomplish stated objectives.

4. Disney in Hong Kong: Bad luck or bad planning?
Critical Thinking Questions focus on:
What did it do right? Do wrong?
Levels of planning applied?
Planning horizon for its Asian operations?
Advantages and disadvantages of establishing long term plans?

5. What is planning? The management function that:
assesses the management environment to set future objectives; and
maps out activities necessary to achieve those objectives.
Planned actions require careful resource allocation.
Plans must be accompanied by implementation guidelines.

6. Key Elements to a Plan
Objectives
Actions
Resource
Implementation

7. Benefits of Planning Assessment of external forces
Develop a sense of direction and purpose
Identifying the factors that affect the organization
Encouraging participation
Coordination of efforts
Establishment of priorities
Focusing attention on different time horizons

8. Benefits of planning (continued)
Understanding circumstances contributing to past success or failure
Ensuring the availability of adequate resources
Establishing performance standards
Supporting organizational control systems
Developing “what if” scenarios
Management development

9. The Pitfalls of Planning
Poor forecasts of future conditions
Plans imposed from above
Planning as a self-contained activity
Extensive bureaucratization
Inflexible adherence to objectives and processes

10. Keys to Successful Planning
Decentralizing the planning powers
Using both numerical and judgmental methods
Viewing planning as continuous and capable of adapting to change
Avoiding paralysis of the analysis
Concentrating on a manageable set of issues

11. Good and Bad Planning GOOD BAD Decentralize planning process
Use numerical and judgmental methods
Assess external forces
Develop a sense of direction and purpose
Identify factors that affect the organization
Encourage participation
Coordinate efforts
Establish priorities
BAD
Poor forecast of future conditions
Plans imposed from poor forecasts
Planning as self-contained activity

12. Formal Planning and Opportunistic Planning
Formal planning systems are designed to:
Identify objectives; and to
Structure the major tasks of the organization to accomplish them.
Opportunistic planning involves:
Programmatic actions triggered by unforeseen circumstances.
It can coexist with formal planning and can help the formal plan function more smoothly.

13. The Formal Planning Process Involves
Setting objectives
Charting a course of action to meet the objectives
Implementation

14. Setting Objectives
Objectives are more general at the top and become more specific at the lower level
Overall objectives of the organization reflect its mission
Objectives should be specific and measurable.
Objectives should be challenging and achievable
Objectives should specify a timetable or deadline for accomplishment.
Objectives should be prioritized.

15. Key Steps of the MBO Cycle
3. Formally Evaluate Extent to Which Objectives Were Met or Exceeded
1. Establish Mutually Agreed Objectives between Employee and Supervisor
4. Monitor Progress toward Achievement of Objectives (Ongoing)
2. Develop Action Plan to Accomplish Objectives

16. Charting a Course of Action
Strategic Action Plans
Tactical Action Plans
Operational Action Plans

17. To be effective, a strategic action plan should meet the following criteria:
Proactivity – The degree to which the strategic action plan takes a long-term view of the future.
Congruency – The extent to which the strategic action plan fits with organizational characteristics and the external environment.
Synergy – The integration of the efforts of various organizational subunits to better accomplish corporate-wide business objectives.

18. Two important aspects of tactical action plans:
Division of Labor – The formal assignment of authority and responsibility to job holders.
Helps ensure that tasks of jobholders are appropriate for accomplishing the department’s tactical action plan, which in turn should support the organization’s strategic action plan.
Budgeting – Controlling and allocating funds.
Variable budgeting
Moving budgeting

19. A Typical Operating System
Control
Inputs
Transformation
Outcome
Feedback Loop

20. Benefits of Operational Planning
The opportunity to use feedback for continued incremental learning.
The ability to visualize alternative types of operations – that is, alternative ways to use resources to create a product or service.
The ability to predict the effects of modifications in operations on the efficiency of operations.
The ability to evaluate the effectiveness of operations.

21. Project Planning
Project: a set of tasks designed to achieve certain objectives
Project planning:
Identify tasks to be done
Timeline (when tasks need to be done)
Resources required
Establish control process, e.g. document what has been accomplished so far.

22. Implementation A distinction Policy Rule Standing plans
Single-use plans
Policy
General guide
Rule

23. Implementation Means of implementation: Authority Persuasion Policy
Feedback mechanism

24. A Six-Stage Approach to Facilitate Organizational Problem Solving
Identify performance gaps.
Identify tasks and work processes necessary for accomplishing the plan.
Check for organizational congruence.
If any in-congruencies or inconsistencies are found, intervene to create alignment in order to effectively implement the plan.
Execute the plan.
Learn from the consequences.

25. Mechanisms to Deal with Organizational Change
Deal with power and politics
Reduce individual anxiety and resistance
Maintaining control during the transition period

26. As a Manager Engaged in Planning You Should:
Keep a pulse for what customers want and be on the lookout for changing consumer desires.
Ensure that planning in your area of responsibility is closely linked with the rest of the organization.
Establish an effective goal-driven plan.
Ensure that planning does not become a straightjacket.
Engage others in plan design and implementation.

27. Disney in Hong Kong: Bad luck or bad planning?
Responses to Critical Thinking Questions:
They got some things right, others wrong
Levels of planning – strategic decision to enter Asian market and Hong Kong as a first site, tactical decisions on design of the park, and operational plans such as hiring policies, discounting tickets, etc.
Planning horizon includes expansion in Asia
Long term plans require objectives, which establishes a criteria or benchmark (or success or failure); these objectives require review given emerging conditions

28. Focusing on the Future . . . P. 215
This is a useful synopsis of this chapter.

29. In-class exercises
Bottom-up planning
Contingency planning

30. Bottom-Up planning

31. Contingency planning: Minicase 5.2 (p. 219)

32. Venture Planning
Joe to Go