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PowerPointPresentationbyCharlieCookCopyright 2005PrenticeHall Inc Allrightsreserved Copyright 2005PrenticeHall Inc Allrightsreserved 7 2 LEARNINGOUTLINEFollowthisLearningOutlineasyoureadandstudythischapter WhatIsPlanning Defineplanning Differentiatebetweenformalandinformalplanning WhyDoManagersPlan Describethepurposesofplanning Telltheconclusionsfromstudiesoftherelationshipbetweenplanningandperformance HowDoManagersPlan Definegoalsandplans Describethetypesofgoalsorganizationsmighthave Explainwhyit simportanttoknowanorganization sstatedandrealgoals Copyright 2005PrenticeHall Inc Allrightsreserved 7 3 LEARNINGOUTLINE cont d FollowthisLearningOutlineasyoureadandstudythischapter HowDoManagersPlan cont d Describeeachofthedifferenttypesofplans EstablishingGoalsandDevelopingPlansDiscusshowtraditionalgoalsettingworks Explaintheconceptofthemeans endchain Describethemanagementbyobjective MBO approach ListthestepsinatypicalMBOprogram DiscusstheadvantageanddrawbacksofMBOprograms Describethecharacteristicsofwell designedgoals Explainthestepsinsettinggoals Copyright 2005PrenticeHall Inc Allrightsreserved 7 4 LEARNINGOUTLINE cont d FollowthisLearningOutlineasyoureadandstudythischapter EstablishingGoalsandDevelopingPlans cont d Discussthecontingencyfactorsthataffectplanning Describetheapproachestoplanning EstablishingGoalsandDevelopingPlans cont d Explainthecriticismsofplanningandwhetherornotthey revalid Describehowmanagerscaneffectivelyplanintoday sdynamicenvironment Copyright 2005PrenticeHall Inc Allrightsreserved 7 5 WhatIsPlanning PlanningAprimaryfunctionalmanagerialactivitythatinvolves Definingtheorganization sgoalsEstablishinganoverallstrategyforachievingthosegoalsDevelopingacomprehensivesetofplanstointegrateandcoordinateorganizationalwork TypesofplanningInformal notwrittendown short termfocus specifictoanorganizationalunit Formal written specific andlong termfocus involvessharedgoalsfortheorganization Copyright 2005PrenticeHall Inc Allrightsreserved 7 6 WhyDoManagersPlan PurposesofPlanningProvidesdirectionReducesuncertaintyMinimizeswasteandredundancySetsthestandardsforcontrolling Copyright 2005PrenticeHall Inc Allrightsreserved 7 7 PlanningandPerformance TheRelationshipBetweenPlanningAndPerformanceFormalplanningisassociatedwith Higherprofitsandreturnsofassets Positivefinancialresults Thequalityofplanningandimplementationaffectsperformancemorethantheextentofplanning Theexternalenvironmentcanreducetheimpactofplanningonperformance Formalplanningmustbeusedforseveralyearsbeforeplanningbeginstoaffectperformance Copyright 2005PrenticeHall Inc Allrightsreserved 7 8 HowDoManagersPlan ElementsofPlanningGoals alsoObjectives Desiredoutcomesforindividuals groups orentireorganizationsProvidedirectionandevaluationperformancecriteriaPlansDocumentsthatoutlinehowgoalsaretobeaccomplishedDescribehowresourcesaretobeallocatedandestablishactivityschedules Copyright 2005PrenticeHall Inc Allrightsreserved 7 9 TypesofGoals FinancialGoalsArerelatedtotheexpectedinternalfinancialperformanceoftheorganization StrategicGoalsArerelatedtotheperformanceofthefirmrelativetofactorsinitsexternalenvironment e g competitors StatedGoalsversusRealGoalsBroadly wordedofficialstatementsoftheorganization intendedforpublicconsumption thatmaybeirrelevanttoitsrealgoals whatactuallygoesonintheorganization Copyright 2005PrenticeHall Inc Allrightsreserved 7 10 TypesofPlans StrategicPlansApplytotheentireorganization Establishtheorganization soverallgoals Seektopositiontheorganizationintermsofitsenvironment Coverextendedperiodsoftime OperationalPlansSpecifythedetailsofhowtheoverallgoalsaretobeachieved Covershorttimeperiod Copyright 2005PrenticeHall Inc Allrightsreserved 7 11 TypesofPlans cont d Long TermPlansPlanswithtimeframesextendingbeyondthreeyearsShort TermPlansPlanswithtimeframesononeyearorlessSpecificPlansPlansthatareclearlydefinedandleavenoroomforinterpretationDirectionalPlansFlexibleplansthatsetoutgeneralguidelines providefocus yetallowdiscretioninimplementation Copyright 2005PrenticeHall Inc Allrightsreserved 7 12 TypesofPlans cont d Single UsePlanAone timeplanspecificallydesignedtomeettheneedofauniquesituation StandingPlansOngoingplansthatprovideguidanceforactivitiesperformedrepeatedly Copyright 2005PrenticeHall Inc Allrightsreserved 7 13 ApproachestoEstablishingGoals TraditionalGoalSettingBroadgoalsaresetatthetopoftheorganization Goalsarethenbrokenintosubgoalsforeachorganizationallevel Assumesthattopmanagementknowsbestbecausetheycanseethe bigpicture Goalsareintendedtodirect guide andconstrainfromabove Goalsloseclarityandfocusaslower levelmanagersattempttointerpretanddefinethegoalsfortheirareasofresponsibility Copyright 2005PrenticeHall Inc Allrightsreserved 7 14 ApproachestoEstablishingGoals cont d MaintainingtheHierarchyofGoalsMeans EndsChainTheintegratednetworkofgoalsthatresultsfromaestablishingaclearly definedhierarchyoforganizationalgoals Achievementoflower levelgoalsisthemeansbywhichtoreachhigher levelgoals ends Copyright 2005PrenticeHall Inc Allrightsreserved 7 15 ApproachestoEstablishingGoals cont d ManagementByObjectives MBO Specificperformancegoalsarejointlydeterminedbyemployeesandmanagers Progresstowardaccomplishinggoalsisperiodicallyreviewed Rewardsareallocatedonthebasisofprogresstowardsthegoals KeyelementsofMBO Goalspecificity participativedecisionmaking anexplicitperformance evaluationperiod feedback Copyright 2005PrenticeHall Inc Allrightsreserved 7 16 DoesMBOWork ReasonforMBOSuccessTopmanagementcommitmentandinvolvementPotentialProblemswithMBOProgramsNotaseffectiveindynamicenvironmentsthatrequireconstantresettingofgoals Overemphasisonindividualaccomplishmentmaycreateproblemswithteamwork AllowingtheMBOprogramtobecomeanannualpaperworkshuffle Copyright 2005PrenticeHall Inc Allrightsreserved 7 17 CharacteristicsofWell DesignedGoals Writtenintermsofoutcomes notactionsFocusesontheends notthemeans MeasurableandquantifiableSpecificallydefineshowtheoutcomeistobemeasuredandhowmuchisexpected ClearastotimeframeHowlongbeforemeasuringaccomplishment ChallengingbutattainableLowgoalsdonotmotivate Highgoalsmotivateiftheycanbeachieved WrittendownFocuses defines andmakesgoalvisible CommunicatedtoallPutseverybody onthesamepage Copyright 2005PrenticeHall Inc Allrightsreserved 7 18 StepsinGoalSetting Reviewtheorganization smissionstatement Dogoalsreflectthemission Evaluateavailableresources Areresourcessufficienttoaccomplishthemission Determinegoalsindividuallyorwithothers Aregoalsspecific measurable andtimely Writedownthegoalsandcommunicatethem Iseverybodyonthesamepage Reviewresultsandwhethergoalsarebeingmet Whatchangesareneededinmission resources orgoals Copyright 2005PrenticeHall Inc Allrightsreserved 7 19 DevelopingPlans ContingencyFactorsinAManager sPlanningManager slevelintheorganizationStrategicplansathigherlevelsOperationalplansatlowerlevelsDegreeofenvironmentaluncertaintyStableenvironment specificplansDynamicenvironment specificbutflexibleplansLengthoffuturecommitmentsCurrentplansaffectingfuturecommitmentsmustbesufficientlylong termtomeetthecommitments Copyright 2005PrenticeHall Inc Allrightsreserved 7 20 ApproachestoPlanning EstablishingaformalplanningdepartmentAgroupofplanningspecialistswhohelpmanagerswriteorganizationalplans Planningisafunctionofmanagement shouldneverbecomethesoleresponsibilityofplanners InvolvingorganizationalmembersintheprocessPlansaredevelopedbymembe

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