1. Copyright ©2008 by Cengage Learning. All rights reserved 1 Chapter 5 Planning and Decision Making Designed & Prepared by B-books, Ltd. MGMT 2008 Chuck Williams

2. Copyright ©2008 by Cengage Learning. All rights reserved 2 Benefits of Planning Creation of Task Strategies Creation of Task Strategies Intensified Effort Direction Persistence 1.1

3. Copyright ©2008 by Cengage Learning. All rights reserved 3 Pitfalls of Planning Detachment of Planners Impedes Change and Adaptation False Sense of Certainty 1.2

4. Copyright ©2008 by Cengage Learning. All rights reserved 4 S.M.A.R.T.S.M.A.R.T. Specific Measurable Attainable Realistic Timely Setting Goals 2.1

5. Copyright ©2008 by Cengage Learning. All rights reserved 5 Developing Effective Action Plans Specific Steps People Resources Time Period An Action Plan Lists… 2.3

6. Copyright ©2008 by Cengage Learning. All rights reserved 6 Tracking Progress Set… Proximal Goals Distal Goals Gather and provide… Performance Feedback 2.4

7. Copyright ©2008 by Cengage Learning. All rights reserved 7 Starting at the Top Strategic Plans Clarify how the company will serve customers and position itself against competitors (2-5 years) Vision An inspirational statement of an organization’s purpose (2 sentences) Mission Overall goal that unifies efforts toward its vision, stretches and challenges, and possesses a finish line and time frame. Flows from vision. 3.1

8. Copyright ©2008 by Cengage Learning. All rights reserved 8 Bending in the Middle Tactical Plans Specify how a company will use resources, budgets, and people to accomplish goals within its mission. (6 months to 2 years) Management by Objectives Develop and carry out tactical plans MBO is a four-step process 3.2

9. Copyright ©2008 by Cengage Learning. All rights reserved 9 Finishing at the Bottom Operational Plans Day-to-day plans for producing or delivering products and services over a 30-day to six-month period 3.3

10. Copyright ©2008 by Cengage Learning. All rights reserved 10 Kinds of Operational Plans Single-Use Plans Plans that cover unique, one-time-only events Standing Plans Plans used repeatedly to handle frequently recurring events. Three kinds are: policies, procedures, and rules and regulations. Plans used repeatedly to handle frequently recurring events. Three kinds are: policies, procedures, and rules and regulations. Budgets Quantitative planning to decide how to allocate money to accomplish company goals 3.3

11. Copyright ©2008 by Cengage Learning. All rights reserved 11 Steps to Rational Decision Making Define the problem Identify decision criteria Weight the criteria Generate alternative courses of action Evaluate each alternative Compute the optimal decision 1 1 2 2 3 3 4 4 5 5 6 6 4 4

12. Copyright ©2008 by Cengage Learning. All rights reserved 12 Using Groups to Improve Decision Making Delphi Technique Stepladder Technique Stepladder Technique Electronic Brainstorming Structured Conflict Nominal Group Technique 5 5