Post on 11-May-2022
CHAPTER 3
PLANNING
TECHNICAL
ACTIVITIES
THE NATURE OF PLANNING
A plan, which is the output of planning, provides a
methodical way of achieving desired results.
To minimize mistakes in decision-making, planning is
undertaken.
Without the plan, some minor tasks may be afforded
major attention which may, later on, hinder the
accomplishment of objectives.
PLANNING DEFINED
Planning in various ways:
Nickels and others – The management function that involves anticipating future trends and determining the best strategies and tactics to achieve organizational objectives.
Aldag and Stearns – The selection and sequential ordering of tasks required to achieve an organizational goal.
Cole and Hamilton – Deciding what will be done, where, when and how it will be done, and the standards to which it will be done.
PLANNING AT VARIOUS
MANAGEMENT LEVELS
Planning activities undertaken at various levels are as
follows:
Top management level – strategic planning
Middle management level – intermediate planning
Lower management level – operational planning
Chief Executive
Officer, President
Vice Presidents
General Manager
Division Heads
Functional Managers
Product Line Managers
Department Heads
Unit Managers
First Line Supervisors
Top
Management
Middle
Management
Lower
Management
Strategic
Planning
(One to ten
years)
Intermediate
Planning
(Six months to
two years)
Operational
Planning
(One week to
one year)
MANAGEMENT LEVEL PLANNING HORIZON
STRATEGIC PLANNING Refers to the process of determining the major goals of
the organization and the policies and strategies for obtaining and using resources to achieve those goals
The output is the STRATEGIC PLAN
Spells out the decision about long-range goals and the course of action to achieve these goals
Parts of strategic planning:
Company or Corporate Mission
Objectives or Goal
Strategies
INTERMEDIATE PLANNING Refers to the process of determining the contributions
that subunits can make with allocated resources.
The goals of a subunit are determined and a plan is prepared to provide a guide to the realization of the goals.
It is designed to support the strategic plan.
OPERATIONAL PLANNING Refers to the process of determining how specific tasks
can best be accomplished on time with available resources
It must be performed in support of the strategic plan and intermediate plan
THE PLANNING PROCESS
Generally, planning involves the following:
Setting organizational, divisional, or unit goals
Goals = the precise statement of results sought,
quantified in time and magnitude, where possible
Developing strategies or tactics to reach those
goals
Strategy = a course of action aimed at ensuring
that the organization will achieve its objectives
Tactic = a short term action taken by management
to adjust to negative internal or external influences
Generally, planning involves the following:
Determining resources needed
Human
Non-human
Setting standards
Standards for measuring performance may be set at the planning stage
When actual performance does not match with planned performance, corrections or reinforcements should be given
TYPES OF PLANS Classification of Plans:
Functional area plan
Marketing Plan
The Executive Summary
Table of Contents
Situational Analysis and Target Market
Marketing Objectives and Goal
Marketing Strategies
Marketing Tactics
Schedules and Budgets
Financial Data and Control
Production Plan
The amount of capacity the company must have
How many employees are required
How much material must be purchased
Financial Plan
An analysis of the firm’s current financial condition as
indicated by an analysis of the most recent statements.
A sales forecast
The capital budget
The cash budget
A set of pro forma (or projected) financial statements
Human Resource Management Plan
Personnel requirement of the company
Plans for recruitment and selection
Training plan
Retirement plan
Plans with time horizon
Short-range Plan
Long-range Plan
Plans according to Frequency of Use
Standing Plans
Policies – broad guidelines to aid managers
at every level in making decisions about
recurring situations or functions
Procedures – plans that describe the exact
series of actions to be taken in a given
situations
Rules – statements that either require or
forbid a certain action
Single-use Plans
Budgets – a plan which sets forth the projected
expenditure for a certain activity and explains
where the required plans will come from
Programs – a single-use plan designed to
coordinate a large set of activities
Projects – a single-use plan that is usually more
limited in scope that a program and is
sometimes prepared to support a program
MAKING PLANNING EFFECTIVE Recognize the planning barriers
Manager’s inability to plan
Improper planning process
Lack of commitment to the planning process
Improper information
Focusing on the present at the expense of the future
Too much reliance on the planning department
Concentrating on only the controllable variables
Aids to planning
Gather as much information as possible
Develop multiple sources of information
Involve others in the planning process