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Transcript of ©2008 by Nelson, a division of Thomson Canada Limited 1 Management Second Canadian Edition Chuck...
©2008 by Nelson, a division of Thomson Canada Limited 1
Management Second Canadian Edition
Chuck WilliamsAlex Z. KondraConor Vibert
Slides Prepared by:Kerry Rempel, Okanagan College
©2008 by Nelson, a division of Thomson Canada Limited 2
Chapter 4
Planning
©2008 by Nelson, a division of Thomson Canada Limited 3
What Would You Do?
To combat the rapid decline in market share, Air Canada launched two new discount airlines to compete directly with WestJet
Initially this enabled the troubled carrier to turn a profit, however the profits did not continue
With only 40 planes in Zip and Tango, what would you do?
©2008 by Nelson, a division of Thomson Canada Limited 4
Learning Objectives:Planning
After reading the next two sections, you should be able to:
1. discuss the costs and benefits of planning2. describe how to make a plan that works
©2008 by Nelson, a division of Thomson Canada Limited 5
Costs and Benefits of Planning
Benefits of Planning
Planning Pitfalls
©2008 by Nelson, a division of Thomson Canada Limited 6
Benefits of Planning
Intensified Effort Persistence Direction Creation of Task Strategies
©2008 by Nelson, a division of Thomson Canada Limited 7
Planning Pitfalls
Impede change and slow or prevent adaptation
Create a false sense of security Detachment of planners
©2008 by Nelson, a division of Thomson Canada Limited 8
How to Make a Plan That Works
Exhibit 4.1
©2008 by Nelson, a division of Thomson Canada Limited 9
Setting Goals
Specific Measurable Attainable Realistic Timely
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Goal Commitment
The determination to achieve a goal.Increased by:
Setting goals participatively Making goals public Obtaining top management support
©2008 by Nelson, a division of Thomson Canada Limited 11
Developing an Effective Action Plan
For accomplishing a goal an action plan lists:
Specific steps People Resources Time period
©2008 by Nelson, a division of Thomson Canada Limited 12
Tracking Progress
First method Set proximal (i.e., short-term) goals Set distal (i.e., long-term or primary)
goals Second method
Gather and provide feedback Make adjustments in effort, direction,
and strategies
©2008 by Nelson, a division of Thomson Canada Limited 13
Maintaining Flexibility Options-based planning
keep options open through small, simultaneous investment in many options or plans
Learning-based planning plans need to be continually tested,
changed and improved encourages frequent reassessment
and revision of goals
©2008 by Nelson, a division of Thomson Canada Limited 14
Learning Objectives:Kinds of Plans
After reading the next two sections, you should be able to:
3. discuss how companies can use plans at all management levels, from top to bottom4. describe the different kinds of special-purpose plans that companies use to plan for change, contingencies, and product
development
©2008 by Nelson, a division of Thomson Canada Limited 15
Planning From Top to Bottom
Exhibit 4.3
©2008 by Nelson, a division of Thomson Canada Limited 16
Planning From Top to Bottom
Exhibit 4.3
©2008 by Nelson, a division of Thomson Canada Limited 17
Starting at the Top Vision
statement of a company’s purpose brief, inspirational, clear, and consistent
with company beliefs and values Mission
flows from the vision specific, unifying goal that stretches
and challenges the organization and has a finish line and a timeframe
©2008 by Nelson, a division of Thomson Canada Limited 18
Planning Timeframes
Exhibit 4.4
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Setting Missions Targeting
setting a clear, specific target Common-enemy mission
vowing to defeat a corporate rival Role-model mission
emulating a successful company Internal-transformation mission
aiming to achieve dramatic change to remain competitive
©2008 by Nelson, a division of Thomson Canada Limited 20
Bending in the Middle Tactical Plans
specify how a company will use resources, budgets, and people to accomplish goals
Management by Objectives develop and carry out tactical plans four steps
discuss goals participatively select goals jointly develop tactical plans meet to review performance
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Disadvantages of MBO May involve excessive paperwork Managers are reluctant to give
employees feedback about their performance
Managers and employees sometimes have difficulty agreeing on goals
Employees may neglect important unmeasured parts of their jobs
©2008 by Nelson, a division of Thomson Canada Limited 22
What Really Works
Management by Objectives (MBO) Based on:
goals participation Feedback
Companies that use MBO are likely to outproduce companies that do not use it!
©2008 by Nelson, a division of Thomson Canada Limited 23
Finishing at the Bottom
Operational plans day-to-day plans
Single-use plans deal with unique, one-time-only events
Standing plans plans for recurring events three types
Policies Procedures Rules and regulations
Budgets
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Special-Purpose Plans
Planning for Change
Planning for Contingencies
Planning for Product Development
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Planning for Change
Stretch goals extremely ambitious goals that you
don’t know how to reach Benchmarking
identifying outstanding practices, processes, and standards in other companies
adapting them to your company
©2008 by Nelson, a division of Thomson Canada Limited 26
Planning for Contingencies:Scenario Planning1. Define the scope of the scenario2. Identify the major stakeholders3. Identify environmental trends4. Identify key uncertainties and outcomes5. Using steps 1-4 create initial scenarios6. Check each scenario for consistency and
plausibility of facts7. Create contingency plans from each
scenario8. Develop measures to indicate when
scenario events are occurring
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Planning for Product Development
Aggregate product plans: used to manage and monitor all new
products indicate resources being used for each
product indicate product’s place in company’s
plans help avoid having too many products in
development
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Product-development Process
Four factors: cross-functional teams internal and external communication overlapping development phases frequent testing of product prototypes
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What Really Happened?
Air Canada set specific goals that focused aggressive negotiating with it’s labour unions, changing its mix of planes and shut down Tango and Zip.
They were able to lower labour costs, reduce aircraft and associated costs and restructured its debt.