2. Management: Arab World Edition Robbins, Coulter, Sidani, Jamali Chapter 7: Foundations of Planning Lecturer: [Dr. Naser Al-Khdour]

3. 7-3 Copyright © 2011 Pearson Education Learning Outcomes Follow this Learning Outline as you read and study this chapter. 7.1 Define the nature and purpose of planning Define planning. Describe the purposes of planning. Explain what studies have shown about the relationship between planning and performance. Understand the dynamics of planning in Arab culture. 7.2 Goals And Plans Define goals and plans. Describe the types of goals organizations might have. Describe each of the different types of plans.

4. 7-4 Copyright © 2011 Pearson Education 7.3 Setting Goals and Developing Plans Discuss how traditional goal setting and MBO work. Describe well-written goals and explain how to set them. Discuss the contingency factors that affect planning. Describe the approaches to planning. 7.4 Contemporary Issues in Planning Explain the criticisms of planning. Describe how managers can effectively plan in today’s dynamic environment. Learning Outcomes

5. 7-5 Copyright © 2011 Pearson Education 1.Define planning. 2.Describe the purposes of planning. 3.Explain what studies have shown about the relationship between planning and performance. 4.Understand the dynamics of planning in Arab culture. Define the nature and purpose of planning

6. 7-6 Copyright © 2011 Pearson Education What Is Planning? Planning A primary managerial activity that involves: Defining the organization’s goals Establishing an overall strategy for achieving those goals Developing plans for organizational work activities Formal planning Specific goals covering a specific time period Written and shared with organizational members

7. 7-7 Copyright © 2011 Pearson Education Why Do Managers Plan? Purposes of Planning Provides direction Reduces uncertainty Minimizes waste and redundancy Sets the standards for controlling

8. 7-8 Copyright © 2011 Pearson Education Planning and Performance Formal planning is associated with: – Higher profits and returns on assets. – Positive financial results. The quality of planning and implementation affects performance more than the extent of planning. The external environment can reduce the impact of planning on performance. Formal planning must be used for several years before planning begins to affect performance.

9. 7-9 Copyright © 2011 Pearson Education Planning in Arab Culture Planning is underdeveloped in Arab societies – some attribute this to an Arab culture that is supposedly fixated on the past and resists planning for the future. Fatalism – the belief in predestination, in the sense that a person has no control over things that happen to him as things have already been predestined from God. This is a mistaken understanding of Qadar. – Belief in Qadar does not mean that people should not plan.

10. 7-10 Copyright © 2011 Pearson Education Planning in Arab Culture (cont’d) Early Arabs planned, which explains their successes. Later, however, fatalism – as a historic practice, not a religious doctrine – has displayed itself in their societies. What is needed is a gradual development in value systems, leading to the notion that planning is required to succeed and this is – in fact – in harmony with religious teachings.

11. 7-11 Copyright © 2011 Pearson Education Planning in Arab Culture (cont’d) Emergence of many successful Arab entrepreneurs and managers. They built their businesses on proper planning and adequate organization. This demonstrates that they have been progressively adopting modern managerial standards.

12. 7-12 Copyright © 2011 Pearson Education 1. Define goals and plans. 2. Describe the types of goals organizations might have. 3. Describe each of the different types of plans. Goals And Plans

13. 7-13 Copyright © 2011 Pearson Education How Do Managers Plan? Elements of Planning Goals (also Objectives) 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

14. 7-14 Copyright © 2011 Pearson Education Types of Goals Financial Goals are related to the expected internal financial performance of the organization. Strategic Goals are related to the performance of the firm relative to factors in its external environment (e.g., competitors). If managers emphasize only one goal, other goals necessary for long-term success are ignored.

15. 7-15 Copyright © 2011 Pearson Education SMART Objectives Specific Measurable Time bound Relevant Attainable

16. 7-16 Copyright © 2011 Pearson Education Types of Goals (cont’d) Stated goals can be found in an organization’s charter, annual report, or public relations announcements, or in public statements made by managers. These broadly-worded official statements of the organization (intended for public consumption) that may be irrelevant to its real goals (what actually goes on in the organization).