Planning and

Cybernatic Planning

Eka Darmadi Lim

Gerry Geraldo

Isa Tridjojo

Reni

Topics

• MCS as a Package (in a brief)

• Cybernatic Control

• Planning Control

– Long Range

– Action Planning

• Budget

• Case Study

Topic

Introduction “The Package”

Management Control System

Package

Introduction “The Package”

Management Control System

Package

Today

Introduction “The Package”

Management Control System

Package

Week 4

Introduction “The Package”

Management Control System

Package

Week 5

Introduction “The Package”

Management Control System

Package

Week 6

Introduction “The Package”

Management Control System

Package

Week 7

Introduction “The Package”

Management Control System

Package

Week 8

Topic

Introduction

“Cybernetic Controls”

The Explanation of “Cybernetic Control”

In organizations a cybernetic system can

either be an information system or

control system contingent.

“A cybernetic system would be an

information and decision-support system”

Introduction

“Cybernetic Controls”

Cybernetic Controls

“Inside”

Measuring System Performance

Comparing that performance

to Standards

Modifying system’s

component

Feeding back information about

unwanted

Cybernetic Controls

in Management Control System

Budgets

Financial Measurement

Non-Financial Measurement

Hybrid

Topic

Introduction

Planning Control

• What is Planning?

“Decision making in advance or we can

say planning is looking ahead and

chalking out future courses of action to

be followed.”

Introduction

Planning Control

Types of Planning?

• Long Range Planning

• Action Planning

Topic

Planning Control

“Long Range Planning”

• What is Long Range Planning?

“the goals and actions for the medium

and long run are established.”

“This has a more STRATEGIC focus”

Planning Control

“Long Range Planning”

• “Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy.”

• Simply put, strategic planning determines where an organization is going over the next year or more

Planning Control

“Long Range Planning”

• A Variety of Strategic Planning Models:

Goal Base Planning

Issues Based Strategic

Planning Control

“Long Range Planning”

• Strategic planning involves both analysis of the past (using data cost, revenue, etc.) and forecast of the future

• Strategic planning provides a framework for the more detailed planning that takes place in the planning cycles that follow.

Six Iterative Steps

of Strategic Plan Process

Develop a Corporate Vision, Mission, Objective

Understand the firm’s present position, SWOT

Decide on a corporate diversification strategy that identifies what business the firm

Decide on a strategy for each SBU

Tools for Strategic

Plan Process

SWOT Analysis

Balanced Scorecards

Scenario Planning

The Purpose of Strategic Plan

“For Organization”

Clearly define the

Purpose of Organization

Communicate the Goals

Develop a sense of

Ownership

A Base of Progress that

can be Measured

Topic

Planning Control

“Action Planning”

What is Action Planning?

“Action planning is a sequence of steps that must be taken, or activities that

must be performed well, for a strategy to succeed”

Planning Control

“Action Planning”

The Importance of Action Planning?

“To help the company to reach their

objective (the strategic planning)”

Planning Control

“Action Planning”

• The Importance of Action Planning?

“To help the company to reach their

objective (the strategic planning)”

Planning Control

“Action Planning”

• Major Elements of Action Planning?

Specific Tasks

Time Horizon

Resource Allocation

Planning Control

“Action Planning”

• Main Step in Preparing “Action Planning”

Have a Clear Objective

List of Benefit (Goals)

Step by Step Clearly

Arrange the Steps in Logical

Planning Control

“Action Planning”

• Main Step in Preparing “Action Planning”

Try a Goal Map

Think about The Problems

Review the Progress

Topic

Budgeting

• The process of budgeting is initiated with the establishment of specific targets of performance

• followed by executing plans to achieve such desired goals and from time to time comparing actual results with the targets of performances/goals.

Budgeting

• Strategic planning also has a relation to budgeting because they both involve a planning but they have different activities in two processes.

• The budgeting process focuses on a single year

Budgeting

• Strategic planning focuses on activities

that extend over a period of several years.

Strategic planning precedes budgeting

and provides the framework within which

the annual budget is developed.

The Uses of Budgeting

Fine Turning the Strategic Plan

Coordination

Assigning Responsibility

Basis for performance Evaluation

Budget Preparation Process

Organization

Issuance of Guidelines

Initial Budget Proposal

Negotiation

Budget Preparation Process

Review and Approval

Budget Revisions

Contingency Budgets

Budget Limitation

Budget based on Estimate

Budget must be adjusted to changes

Budget can be useful by Management

Can not replace the management Function

Principal Terms of Successful

Budget Program

Healthy Corporate Organization

Adequate Accounting Systems

Research and Analysis

Support from Executive

The Uses of Budgeting

• “The budget acts as an effective

management tool”

• by providing a means of identifying and

allocating limited resources (Revenues),

and monitoring their use (Expenditures).

The Uses of Budgeting

• “The budget also is used to help prevent

the company from overspending.”

• “Budget reports provide management with

information on operations”

• Allowing the organization to monitor and

control spending and revenue collection

while they are in progress.

Topic

Thank You

Eka Darmadi Lim

Gerry Geraldo

Isa Tridjojo

Reni