MA CH 2 presentation for students All.ppt

it contains all presentation for business mathematics students and others students

1. CHAPTER TWO
PLANNING
1
Practice planning every day!

2. Practice Planning Every Day!
2
To introduce the concept and definition of planning.
Analyze the nature and importance of planning.
Discuss various types of planning.
Explain steps in planning.
Learning Objectives

3. What Is Planning?
•Planning
–A primary managerial activity that involves:
•Defining the organization’s goals and objectives
•Establishing an overall strategy for achieving those goals
•Developing a comprehensive set of plans to integrate and
coordinate organizational work.
–Is a blueprint of future course of action
Informal and formal 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.
Practice Planning Every Day! 3

4. Cont’d
•Planning is deciding in advance what to do, how to do
it, when to do it, and who is to do it.
•It bridges the gap from where we are and where we
want to go. /Koontl and O’Donnel/
•Planning involves the selection of objectives, policies,
procedures and programs from among alternatives.
Practice Planning Every Day! 4

5. Planning answers 6 basic questions?
1.TheWhat(whattodo?):theshort-termorlong-term
goalwewanttoachieve
2.TheWhen(whentodo?):Timeschedule
3.TheWhere(wheretodo?):theplacewheretheplanis
executed.
4.TheWho(whodoesit):individuals/unitsperforming
activities.
5.TheHow(howitisdone):Thestrategy/methodsfor
achievingthegoal.
6.TheHowmuch(Howmuchisrequiredtodo):
Expenditureofresources.
Practice Planning Every Day!
5

6. Key Elements of Planning
•Planning has four elements;
a.Objectives
b.Actions
c.Resources
d.Implementation
Practice Planning Every Day! 7–6

7. a.Objectives
•Objectivesaregoalsortargetsthatthefirmwishesto
reachwithinastatedamountoftime.
•Planningrequiresmanagerstoanticipate/for.c/whatis
likelytohappeninthefuture.
•Itisthefuturedestinationoftheorganization,whichall
employeesdirectedby.
•Thewherewillwewanttobeinthefuture!
Practice Planning Every Day!
7–7

8. b.Actions
•Arethespecificstepsthefirmintendstotaketo
achievethedesiredobjectives.
•Theactivitiesortasksthefirmthinksto
undertaketoachievetheobjectives.
•Itisabout“howwewillgetwherewewantto
be?”
Practice Planning Every Day!
7–8

9. c.Resource Allocation
•Planidentifieswhatresourcesarerequired,wheretheycome
from,andhowtheywillbearranged.
•Amanagershouldbeawareofresourceconstraints
andhowitwouldbeefficientlyused.
•Decisionsregardingresourceallocationdetermine
whetherthegoalscanberealisticallyachieved.
•The“howmuchitcosts”
Practice Planning Every Day!
7–9

10. d.Implementation Guidelines
•Planconsistsofimplementationguidelinesthe
specifyhowtheintendedactionswillbecarried
out.
•Itinvolves
–Divisionoftasksamongdifferentactors,
–Specificationofreportingrelationships
–Establishingthetimelineforaccomplishingeachtask.
Practice Planning Every Day!
7–10

11. IMPORTANCE OF PLANNING
•Planningisimportantforthefollowingreasons
PrimacyofPlanning:firstandforemostfunctionof
management
Itreducesrisk&uncertainty:planninghelpstocopeupwith
&prepareforchangingenv’t.
Tofocusattentiononobjectives:planningfocuseson
organizationalobjectivesandhowtoachievetheseobjectives.
Setsthestandardsforcontrolling:controlcanbeexercised
ifthereareplans(standardsorgoals)
Practice Planning Every Day! 11

12. Cont’d…
Toincreaseorganizationaleffectiveness:achieving
organizationalobjectiveswithinthegivenresources.
Coordinationofefforts:planhelpsmanager
coordinatedifferentindependentlyactingefforts.
Establishmentofpriorities:planshowsthe
prioritizationofproblemsandissues.
Ensuringtheavailabilityofadequateresources
Practice Planning Every Day!
12

13. Limitations of Planning
•Poor forecasts of future conditions
–Businessenvironmentischangingfasterthanever.Even
mostsophisticatedplanningtechniquesmaynotexpect
accuratelywhatislikelytohappeninthefuture.
•Plansimposedfromabove
–Sometimesplangeneratorisdifferentfromplan
implementer
–Plansthatarenotfromthewisdomandexperienceof
thoseattheoperationallevelswithinthefirm.
•Planningasaself-containedactivity
–Planningtaskmaybegiventoseparateunits(planning
staff)fromtherestoftheorganization.
•Planningdonotallowemployeesflexibility
Practice Planning Every Day!
7–13

14. TYPES/CLASSIFICATION OF PLANS
Practice Planning Every Day!
14
•Planscanbeclassifiedonthebasesofthefollowing
dimensions;
1.Breadth (Scope)
2.Time Frame (Duration of the Plan)
3.Frequency (Repetitiveness)
4.Specificity
5.Formulation

15. Practice Planning Every Day!
15
Exhibit 2.1

16. Types of plans based on scope/breadth
1.Strategic Plans
Applytotheentireorganization.
Establishtheorganization’soverallgoals.
Seektopositiontheorganizationintermsofits
environment.
Itisdevelopedbytoplevelmanagersandcover
extendedperiodsoftime.
Itanswersthreebasicquestions
1.Wherearewenow?
2.Wheredowewanttogo?
3.Howdowegetthere?
Practice Planning Every Day!
16

17. 2.Tactical Plans
oIsconcernedwithwhatthelowerlevelunitswithin
eachdivisionmustdo,howtheymustdoit,andwho
willhavetheresponsibilitiesfordoingit.
oDevelopedtoimplementspecificpartsofstrategicplans
oIsaprocessofdevelopingactionplanstoexecute
strategies.
oMostlyshort-terminitstimeframe(oneyearorless)
andnarrowerinscopethanstrategicplans
oItismostlycarriedoutbydepartmentalmanagers
(middlelevelmanagers).
Practice Planning Every Day! 17

18. 3.Operational Plans
•Alsocalledadministrativeplansarethoseamangeruses
toaccomplishhis/herjobresponsibilities
•Itcanbeasingleuseplanlikeaprogramorstanding
planlikepolicy.
•Focusesoncarryingouttacticalplanstoachieve
operationalgoals.
•Mainlyshortrangeandmorespecificanddetailed.
•Concernedwithdaytoday;weektoweekactivitiesof
theorganizations.
•TheseplansaredevelopedbySupervisorylevel
managers.
Practice Planning Every Day! 18

19. 1.Long-rangePlans
–Planswithtimeframesextendingbeyondthreeyears(5-10
years)dependingonthesize&natureoftheorganization
2.Intermediate-rangePlans
–Rangesb/nlong&shortrangeplans
–Planswithtimeframeof1-3yearsdependingonthesize&
natureoftheorganization.
3.Short–rangePlans
–Arenotdevelopedseparately
–Areoperationalplansderivedfromlong-rangeorintermediate
plans
–Planswithtimeframesoflessthan1yeardependingonthe
size&natureoftheorganization.
Practice Planning Every Day!
19
Time frame

20. 1.Single-Use Plan
–A one-time plan specifically designed to meet the
need of a unique situation.
-Single use plans are commonly three types.
a.Programs
-Are single use plans
-They are complex & encompasses goals, policies,
procedures, rules, task assignments, resources, and
budgets.
-Eg: purchasing new machines or introducing new
product
Practice Planning Every Day! 20
1.frequency of userepetitiveness

21. 2)Projects
-Aresmallerportionofaprogram.
-Arelesscomprehensive&narrowerinfocusthan
programs.
-Theyhavepredeterminedtimeschedulefor
completion.
3)Budgets
-Istheresourcesrequiredinnumericalterms
-Itisaquantitativestatementoftheresourcesallotted
tospecificprogramsorprojectsforagivenperiod.
-Itservesasabenchmarkforcontrolling.
Practice Planning Every Day!
21

22. 2.StandingPlans
–Ongoingplansthatprovideguidanceforactivities
performedrepeatedly.
–Areplansthatareusedagain&again;followed
eachtime;anddesignedtodealwithorganizational
issuesorproblemsthatrecurfrequently.
–Standingplansincludes;
A)PurposeorMission
-Itidentifiesthebasicfunctionortaskofan
enterprise.
-Itdescribeswhatanorganizationstandsforandits
reasonforexistence.
Practice Planning Every Day!
22

23. B)GoalsorObjectives
-Aresingleuseplansthatspecifiestheend
towardswhichbusinessactivityisdirected.
-Onceobjectivesareachieved,wedonotuse
themagainbutwetendtodevelopanother
objectives.
-Objectiveshavethefollowingcharacteristics;
Objectivesaremultiple:(objectivessetin
variouskeyareas)
Practice Planning Every Day!
23

24. Objectivescanbetangibleorintangible:(objectives
inthephysicalresourcesaretangiblewhereas
managerialperformanceandworkersmoralecanbe
intangibleobjectives)
Objectiveshaveapriority:(oneobjectivecanbemore
importantthantheother)
Objectivesarehierarchical:(corporate,departmental
andsectionalobjectivesatdifferentorganizational
levels)
Practice Planning Every Day!
24

25. C)Strategies:
-Arecomplexplansforbringingorganizationsfromagiven
positiontoadesiredpositioninthefuture.
D)Policies:
-Isastandingplanthatchannelsthedecisionmakingofemployees.
-Itguidesthinkingandactionratherthanaspecificcourseof
action.
-Eg:recruitmentpolicy,pricingpolicy,advertisementpolicy,
customercarepolicy….
Practice Planning Every Day!
25

26. 3.ContingencyPlanning
-Involvesidentifyingalternativecoursesofactionthatcanbe
implementedifandwhentheoriginalplanprovesinadequate
becauseofchangingconditions.
-Unexpectedproblemsandeventsfrequentlyoccur.Whenthey
do,managersmayneedtochangetheirplans.Anticipating
changeduringtheplanningprocessisbestincasethingsdon’t
goasexpected.
-Contingencyplanningisnecessaryateachlevelofmanagement
andforstrategic,tactical,andoperationalplanning.
Practice Planning Every Day! 26

27. THE PLANNING PROCESS
•Thereare10stepsinplanning
Step1:Understandingtheexistingsituation
-Understandingboththeinternalaswellasexternal
environment.
-Identifyingexternalfactors;opportunities&threats
-Identifyinginternalfactors;strengths&weaknesses
Step2:Forecasting
-Assumptionsaboutwhatthefuturelookslikesincethefuture
isfullofuncertainties.
Practice Planning Every Day!
27

28. Step 3: Establishing Objectives
-Objectives are end results established for the organization and
for each work units.
-Objectives give direction to the major plans.
Step 4: Determine alternative courses of action
-Searching for and examining alternative courses of action
(strategies).
-The number of alternative should be managed.
Step 5: Evaluation alternative course of action:
-Carefully assessing the alternatives by considering them in
light of goals
-Examining the advantage and disadvantage of each alternative
courses of action.
Practice Planning Every Day!
28

29. Step6:Selectingacourseofaction
-isthepointatwhichtheplanisapproved.
-Itistherealpointofdecisionmaking.
Step7:Formulatingderivativeplans
-Derivativeplansarethosewhichsupportthemainplan.
Step8:budgeting:
•Atthispoint,allnecessaryresourcesaredeterminedfor
eachunits,tasksandindividuals.
Step9:Implementingtheplans
-Developingactionplanstoimplementplans.
Step10:Controlling&evaluatingtheresults
-Evaluatereportedresultsandmakenecessaryadjustments
Practice Planning Every Day!
29

30. Characteristics of Well-Designed
Goals/objectives
•Writtenintermsofoutcomes,
notactions
–Focusesontheends,notthe
means.
•Measurableandquantifiable
–Specificallydefineshowthe
outcomeistobemeasured
andhowmuchisexpected.
•Clearastotimeframe
–Howlongbeforemeasuring
accomplishment.
•Challengingyetattainable
–Lowgoalsdonot
motivate.
–Highgoalsmotivateif
theycanbeachieved.
•Writtendown
–Focuses,defines,and
makesgoalvisible.
•Communicatedtoall
–Putseverybody“onthe
samepage.”
Practice Planning Every Day!
30

31. Summary
•Whatisplanning?
•WhataretheelementsofPlanning?
•Whyplanningisimportant?
•Whatarethetypesofplanning
•Whatarethestepsinplanningprocess?
7–31

32. Thank you for your attention!!
32