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FOUNDATION OF PLANNING

FOUNDATION OF PLANNING. What Is Planning?. A primary functional managerial activity that involves: Defining the organization’s goals Establishing an overall strategy for achieving those goals Developing a comprehensive set of plans to integrate and coordinate organizational work.

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FOUNDATION OF PLANNING

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  1. FOUNDATION OF PLANNING

  2. What Is Planning? • A primary functional managerial activity that involves: • Defining the organization’s goals • Establishing an overall strategy for achieving those goals • Developing a comprehensive set of plans to integrate and coordinate organizational work. • Types of planning • Informal: not written down, short-term focus; specific to an organizational unit. • Formal: written, specific, and long-term focus, involves shared goals for the organization.

  3. Why Do Managers Plan? • Provides direction • Reduces uncertainty • Minimizes waste and redundancy • Sets the standards for controlling

  4. 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

  5. Written in terms of outcomes, not actions Focuses on the ends, not the means. Measurable and quantifiable Specifically defines how the outcome is to be measured and how much is expected. Clear as to time frame How long before measuring accomplishment. Challenging yet attainable Low goals do not motivate. High goals motivate if they can be achieved. Written down Focuses, defines, and makes goal visible. Communicated to all Puts everybody “on the same page.” Characteristics of Well-Designed Goals

  6. Example of Company’s Goals • Example 1: Company’s goals for 2009 • Become internationally recognized • Improve product quality • Increase revenue and profit • Improve customer’s satisfaction • Example 2: A production team • Improve quality • Improve productivity • Ensure high safety level

  7. Team Project: Your Team’s Goals and Plans

  8. Procter & Gamble’s OGSM Technique • What needs to be done • Objectives • written statement of compelling business needs • Goals • numerical target and scorecard to track progress toward meeting objectives

  9. Procter & Gamble’s OGSM Technique (cont.) • How we will achieve our objectives • Strategies • written statement of specific actions that must be taken to meet objectives • Measures • numerical measures to track progress on executing specific actions

  10. Balanced Goals from Different Perspectives • Financial Perspective • Profitability, Return on Investment • Customer Perspective • Satisfaction, market share, repeated customers • Internal Perspective • System, operation, capability • Learning Perspective • New technology, management, ideas,

  11. Characteristics of Good Plan • Prediction of environmental trends • Scenarios • Goals • SMART: specific, measurable, attainable, realistic, and time • Resources • Feasible but stretching • Actions • Specific, clear, integrated, fit with goals • Changes: flexible and creative

  12. Example: A Business Plan • Business objectives • Functional objectives: • Finance, marketing, HR, production, R&D, ... • Resources • Finance, HR, management, IT, ... • Actions

  13. Case: Bookstore From Management and Planning perspective, explain: • Why the Bookstore succeeded in early days? • Why did it fail later? • What do you learn?

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