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Chapter 7Managerial Planning and

Goal Setting

True/False Questions

1. The Europa Hotel survived terrorism by carefully planning security measures for guests,employees, and the building.

Answer: True Level: !age: "# Type: $

. %ecause everything else stems from leading, of the four management functions, leading isconsidered the most fundamental.

Answer: $alse Level: !age: "& Type: $

". A desired future state that the individual or organi'ation attempts to reali'e is a goal.

Answer: True Level: 1 !age: "& Type: $

(. )oals specify today*s means+ plans specify future ends.

Answer: $alse Level: !age: "& Type: $

. The act of determining the organi'ation goals and the means for achieving them is calledgoal setting.

Answer: $alse Level: 1 !age: "& Type: $

-. The mission is the basis for the strategic level of goals and plans, which in turn shapes thetactical and operational level.

Answer: True Level: 1 !age: "& Type: $

#. The compleity of today/s environment and uncertainty about the future overwhelm manymanagers and lead them to focus on long0term goals and plans instead of operationalissues and short0term results.

Answer: $alse Level: !age: " Type: $

Chapter Seven * Managerial Planning and Goal Setting

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&. %ecause they provide legitimacy, rationale for decisions, and an increase in motivation andcommitment, goals and plans are valuable to an organi'ation.

Answer: True Level: 1 !age: "0(2 Type: $

. A plan tells 3why3 to achieve the goal.

Answer: $alse Level: !age: (2 Type: $

12. !lans provide a standard of assessment.


11. A broad definition of the organi'ation*s values, aspiration and reason for being, along witha recognition of the scope and operations that distinguishes the organi'ation refers to a%usiness 4trategic 4tatement.


1. The company*s philosophy as well as purpose is often epressed in mission statements.

Answer: True Level: !age: (1 Type: $

1". An organi'ation*s mission describes its reason for eistence.

Answer: True Level: !age: (1 Type: $

1(. 4trategic plans and goals are those that focus on where the organi'ation wants to be in the

future and pertain to the organi'ation as a whole.

Answer: True Level: 1 !age: ( Type: $

1. A broad statement of where the organi'ation wants to be in the future refers to a missionstatement.

Answer: $alse Level: 1 !age: ( Type: $

1-. 5perational plans and goals are those that focus on the outcomes that ma6or divisions anddepartments must achieve in order for the organi'ation to reach its overall goals.

Answer: $alse Level: !age: ( Type: $

1#. The department manager*s tool for daily and wee7ly operations is called the operationalplan.

Answer: True Level: 1 !age: (" Type: $


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1&. A means0end chain is when lower0level goals lead to the accomplishment of higher0levelgoals.

Answer: True Level: 1 !age: (( Type: $

1. 4pecific and measurable goal characteristics apply only to the lower0level goals.

Answer: $alse Level: !age: ( Type: $

2. )oals are most effective when they are specific, measurable, challenging and lin7ed torewards.

Answer: True Level: !age: (- Type: $

1. To be effective, goals must be set for every aspect of employee behavior or organi'ationalperformance.

Answer: $alse Level: !age: (- Type: $

. The goals should be easy, for employees to feel motivated, so that they can achieve themeasily which in turn increases their motivation level.

Answer: $alse Level: !age: (- Type: $

". 8%5 refers to managing by opportunity.

Answer: $alse Level: 1 !age: (# Type: $

(. The most difficult step in an 8%5 process is reviewing progress.

Answer: $alse Level: !age: (# Type: $

. An eample of a 9ualitative goal is the ;niversity will provide 9uality education at a fairprice.dea

Answer: c Level: 1 !age: "& Type: $

. specify future ends and specify today*s means.

a. )oals, plansb. !lans, goalsc. !lanning, organi'ingd. >deas, behaviorse. 8ission, vision

Answer: a Level: !age: "& Type: $

". A blueprint specifying the resource allocations schedules, and other actions necessary for

attaining goals is referred to as anI

a. goal.b. plan.c. mission.d. vision.e. ob6ective.


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Answer: b Level: 1 !age: "& Type: $

(. JJJJJJ is the act of determining the organi'ation*s goals and the means for achievingthem.

a. %rainstormingb. 5rgani'ingc. !lanningd. Keveloping a missione. A blueprint

Answer: c Level: 1 !age: "& Type: $

. The planning process begins with which of theseF

a. The development of operational goalsb. The development of a mission statement

c. =ommunication of goals to the rest of the organi'ationd. A company0wide meetinge. %rainstorming

Answer: b Level: !age: "& Type: $

-. The is the basis for the strategic level of goals and plans which in turn shapesthe and level.

a. goal, mission, tacticalb. ob6ective, operational, mission

c. operational goal, mission and tacticald. mission, tactical, operationale. tactical plan, operational, mission

Answer: d Level: !age: "& Type: $

#. hich of these are primarily responsible for strategic goalsDplansF

a. 8iddle managementb. %oard of directorsc. =onsultants

d. 4enior managemente. Lower management

Answer: d Level: 1 !age: "& Type: $

&. JJJJJJ is primarily responsible for operational goalsDplans.

a. 8iddle management


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b. %oard of directorsc. =onsultantsd. 4enior managemente. Lower management

Answer: e Level: 1 !age: " Type: $

. hich of these isDare primarily concerned with tactical goalsDplansF

a. 8iddle managementb. %oard of directorsc. =onsultantsd. 4enior managemente. Lower management

Answer: a Level: 1 !age: " Type: $

12. @uby is a first0line supervisor at @ooftop =orporation. 4he is most concerned with whichlevel of goalsF

a. 5perational goalsb. Tactical plansc. 4trategic goalsd. 8ission statemente. Gision

Answer: a Level: !age: " Type: A

11. JJJJJJ symboli'es the legitimacy of the organi'ation to eternal audiences.

a. 5perational goalsb. Tactical plansc. 4trategic goalsd. 8ission statemente. Tactical goals

Answer: d Level: !age: " Type: $

1. @osalie is a manager at )8) )aming. 4he recently attended a seminar on goal setting.

4he wishes to use goals to provide a sense of direction to her staff. 4he is using goals as

a. a way to legitimi'e her department.b. a source of motivation.c. a standard of performance.d. a guide to action.e. impress others.


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Answer: d Level: !age: (2 Type: A

1". A statement that identifies distinguishing characteristics of an organi'ation is 7nown as

a. a goals statement.

b. a values statement.c. an income statement.d. a mission statement.e. a competitive0edge statement.

Answer: d Level: 1 !age: (1 Type: $

1(. hich of these are described by mission statementsF

a. =orporate valuesb. =ompany philosophyc. =ompany purpose

d. All of the abovee. a and b only

Answer: d Level: 1 !age: (1 Type: $

1. The organi'ation*s reason for eistence is 7nown as

a. the organi'ation*s value.b. the organi'ation*s vision.c. the organi'ation*s mission.d. the organi'ation*s goal.

e. the organi'ation*s service.

Answer: c Level: !age: (1 Type: $

1-. 3e respect our employees and value their diversity3 is an eample of a statement you aremost li7ely to find in the organi'ation*s

a. mission.b. strategic goals.c. tactical goals.d. strategic plans.

e. tactical plans.

Answer: a Level: " !age: (1 Type: A

1#. 3e see7 to become the premier business school in the west3 is an eample of a statementyou are most li7ely to find in the organi'ation*s

a. tactical goals.


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b. operational goals.c. mission.d. tactical plans.e. operational plans.

Answer: c Level: " !age: (1 Type: A

1&. hich of these refers to a broadly stated definition of the organi'ation*s basic businessscope and operations that distinguishes it from similar types of organi'ationsF

a. 8ission statementb. )oal statementc. 8anagement by ob6ectived. )oal settinge. =orporate competitive0value statement

Answer: a Level: 1 !age: (1 Type: $

1. At the top of the goal hierarchy is the

a. strategic goals.b. tactical goals.c. operational goals.d. mission.e. employee goals.

Answer: d Level: !age: (1 Type: $

2. hich of these represent the broad statements of where the organi'ation wants to be inthe futureF

a. 5perational goalsb. Tactical goalsc. 4trategic goalsd. 5perational goalse. Tactical plans

Answer: c Level: 1 !age: ( Type: $

1. The official goals of the organi'ation are best represented by the .

a. strategic goalsb. tactical goalsc. operational goalsd. competitive goalse. none of the above


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Answer: a Level: !age: ( Type: $

. A long0term time frame is most closely associated with

a. operational plans.

b. tactical plans.c. strategic plans.d. mission plans.e. tactical goals.

Answer: c Level: !age: ( Type: $

". hich of these are called the action steps by which an organi'ation intends to attain itsstrategic goalsF

a. Tactical goalsb. 5perational goals

c. Tactical plansd. 5perational planse. 4trategic plans

Answer: e Level: 1 !age: ( Type: $

(. goals lead to the attainment of goals, which in turn lead to the attainmentof goals.

a. 5perational, strategic, tacticalb. Tactical, operational, strategic

c. 4trategic, tactical, operationald. 5perational, tactical, strategice. one of the above.

Answer: d Level: " !age: (0(" Type: $

. )oals that define the outcomes that ma6or divisions and departments must achieve in orderfor the organi'ation to reach its overall goals is called

a. strategic goals.b. tactical goals.

c. operational goals.d. a mission.e. a plan.

Answer: b Level: 1 !age: ( Type: $

-. %eth is a middle manager at Egg Elements =orporation. 4he is most li7ely responsible forthe achievement of goals.


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a. operationalb. tacticalc. strategicd. lower0level

e. top0level

Answer: b Level: !age: ( Type: $

#. JJJJJJ represent plans developed at the organi'ation*s lower levels that specify actionsteps toward achieving operational goals and that support tactical planning activities.

a. Tactical plansb. 4trategic plansc. 5perational plansd. 4upervisory planse. 5rgani'ational plans

Answer: c Level: 1 !age: (" Type: $

&. hich of these refer to specific results epected from individualsF

a. 5perational goalsb. Tactical goalsc. 4trategic goalsd. 5perational planse. 8ission statements

Answer: a Level: !age: (" Type: $

. Lower0level goals should lead to the achievement of higher0level goals. This is called

a. lin7ing pin theory.b. a value0based chain.c. a means0end chain.d. all of the above.e. none of the above.

Answer: c Level: !age: (( Type: $

"2. hich of these is lac7ing in the goal 3profits should be increased in the coming yearF3

a. 4pecific and measurableb. =hallenging but realisticc. =overs 7ey result areasd. Kefined time periode. one of the above


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Answer: a Level: !age: ( Type: A

"1. Tabu is a salesperson at a large retail chain. 4he was assigned a goal of M-,222 in salesfor the current 9uarter. 4he is unhappy because she 7nows that the most any salesperson

has sold in one 9uarter in the past is M12,222. Her goal of M-,222 is probably

a. not specific and measurable.b. not realistic.c. irrelevant.d. lac7ing a specific time period.e. does not cover 7ey result area.

Answer: b Level: " !age: (- Type: A

". Bou are violating which of these goal characteristics when you attempt to create goals forevery aspect of employee behaviorF

a. 4pecific and measurableb. Lin7ed to rewardsc. Kefined time periodd. =over 7ey result arease. =hallenging but realistic

Answer: d Level: !age: (- Type: $

"". 4amuel set goals for each of his employees. Each employee ended up with at leasttwenty0five goals. This process violates which of the following criteria for effective goalsF

a. 4pecific and measurableb. =hallenging but realisticc. =overs 7ey result areasd. Kefined time periode. Lin7ed to rewards

Answer: c Level: !age: (- Type: A

"(. All of the following are characteristics of effective goal setting E=E!T

a. goals should be challenging but not unreasonably difficult.b. goals should be set for every aspect of employee behavior.c. specific and measurable.d. cover 7ey results area.e. lin7ed to rewards.

Answer: b Level: !age: (0(- Type: $


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". The ultimate impact of goals depended on the etent to which goal achievement is lin7edto

a. rewards.b. salary increases.

c. promotions.d. all of the above.e. b and c only.

Answer: d Level: !age: (- Type: $

"-. hich of these is the first step in the 8%5 processF

a. 4etting goalsb. Keveloping action plansc. Appraising overall performanced. @eviewing progress

e. one of the above

Answer: a Level: 1 !age: (# Type: $

"#. >n using 8%5, ob6ectives should be set

a. by the supervisor.b. by the employee.c. 6ointly by the supervisor and the employee.d. by the accounting department.e. by top management.

Answer: c Level: !age: (# Type: $

"&. hich of these is a method of management whereby managers and employees define goalsfor every department, pro6ect, and person and use them to monitor subse9uentperformanceF

a. 5rgani'ational planningb. 8anagement by ob6ectivesc. )oal settingd. 8ission development

e. Gision development

Answer: b Level: 1 !age: (# Type: $

". Bard $ence =orporation is currently implementing an 8%5 program. 8anagers andemployees 6ointly set ob6ectives and develop action plans, and goal achievement isevaluated on an annual basis. Bard $ence is missing which ma6or activity that must occurin order for 8%5 to be successfulF



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a. Keveloping a mission statementb. Keveloping tactical goalsc. @eviewing progressd. @eviewing operational plans

e. one of the above

Answer: c Level: !age: (#0(& Type: A

(2. $rostburg $ireplaces has used 8%5 for the past year. Top management 6ust finishedevaluating overall performance. The net step in the 8%5 process should be

a. to develop new action plans.b. to develop new ob6ectives based on the review of last year*s performance.c. to begin a new 8%5 3cycle3, using the same ob6ectives as last year.d. to wait several months to allow information to be digested.e. none of the above.

Answer: b Level: !age: (& Type: A

(1. hich is the final step in the 8%5 processF

a. Appraise overall performanceb. Kevelop an action planc. @eview progressd. 4et goalse. =onduct periodic chec7ups

Answer: a Level: 1 !age: (& Type: $

(. 5ne ma6or problem with 8%5 is

a. it discourages individual creativity.b. it does not wor7 well in constantly changing environments.c. it decreases employee motivation.d. it does not wor7 well in non0profit organi'ations.e. none of the above.

Answer: b Level: !age: ( Type: $

(". hich of the following is 5T one of the benefits of 8%5F

a. !erformance can be improved at all company levels.b. Employees are motivated.c. Efforts are focused on activities that will lead to goal attainment.d. 5perational goals are able to displace strategic goals.e. >ndividual and department goals are aligned with company goals.



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Answer: d Level: !age: ( Type: $

((. hich of these is true about single0use plansF

a. They are developed to achieve a set of goals that are unli7ely to be repeated in thefuture.b. They are used to provide guidance for tas7s performed repeatedly within the

organi'ation.c. They define plans that define company responses to specific situations, such as

emergencies or setbac7s.d. They are most important in the organi'ations.e. one of the above.

Answer: a Level: !age: 2 Type: $

(. 4tanding plans are

a. plans that are developed to achieve a set of goals that are unli7ely to be repeated inthe future.

b. plans that used to provide guidance for tas7s performed repeatedly within theorgani'ation.

c. plans that define company responses to specific situations, such as emergencies orsetbac7s.

d. most important in the organi'ations.e. none of the above.

Answer: b Level: 1 !age: 2 Type: $

(-. A pro6ect is an eample of a

a. policy.b. standing plan.c. procedure.d. single0use plan.e. rule.

Answer: d Level: 1 !age: 2 Type: $

(#. umerous are li7ely to be part of an overall .

a. programs, pro6ectb. policies, pro6ectc. standing plans, programd. pro6ects, programe. programs, rule


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Answer: d Level: !age: 2 Type: $

(&. =alifornia =reamery re9uires that all absent employees bring a note from their doctorwhen returning to wor7. This is an eample of a

a. single0plan use.b. standing plan.c. program.d. procedure.e. pro6ect.

Answer: b Level: !age: 2 Type: A

(. hich of these define boundaries within which to ma7e a decisionF

a. !rogramsb. !olicies

c. @ulesd. !rocedurese. !ro6ect

Answer: b Level: !age: 2 Type: $

2. An eample of a JJJJJJ is a statement supporting the organi'ation*s efforts in the area ofseual harassment.

a. procedureb. rule

c. policyd. single0use plane. program

Answer: c Level: !age: 2 Type: $

1. 3o food andDor drin7s in the classroom3 is an eample of a

a. procedure.b. rule.c. policy.

d. single0use plan.e. pro6ect.

Answer: b Level: !age: 2 Type: A

. hich of these are true about contingency plansF

a. They are developed to achieve a set of goals that are unli7ely to be repeated in the


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future.b. They are used to provide guidance for tas7s performed repeatedly within the

organi'ation.c. They define company responses to specific situations, such as emergencies or

setbac7s.

d. They are most important in the organi'ations.e. one of the above.

Answer: c Level: 1 !age: 1 Type: $

". =ontingency plans are also referred to as

a. standing plans.b. rules.c. scenarios.d. procedures.e. operationally tactical plans.

Answer: c Level: 1 !age: Type: $

(. The crisis management plan should be a JJJJJJJJ that specifies the actions to be ta7en,and by whom, if a crisis occurs.

a. vague, verbal planb. detailed, verbal planc. long, difficult to read pland. vague, written plane. detailed, written plan

Answer: e Level: 1 !age: " Type: $

. hich of the following is not a step in the containment stage in crisis managementF

a. 8eet safety and emotional needsb. @eturn to businessc. 4et up effective communications systemsd. )et the awful truth oute. Activate the crisis management plan

Answer: c Level: !age: Type: $

-. Kuring the JJJJJJ stage of his company/s crisis management, Nesse in7ler must ensurethat the sta7eholders/ physical and emotional needs are met.

a. preventionb. preparationc. containment


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d. responsee. all of the above

Answer: c Level: !age: Type: A

#. Traditionally, if Tara, =E5 of %utterfly !illows, needed to conduct corporate planning, itwould be performed by all of the following E=E!T

a. central planning departments.b. decentrali'ed planning groups.c. top eecutives.d. consulting groups.e. the president of the company.

Answer: b Level: !age: - Type: A

&. The traditional approach to corporate planning was to

a. have a decentrali'ed planning staff.b. have a centrali'ed planning department.c. set up a planning tas7 force.d. set up planning committees.e. use TO8 approach.

Answer: b Level: 1 !age: - Type: $

. A group of planning specialists who develop plans for the organi'ation as a whole is

7nown as

a. management by ob6ectives.b. planning tas7 force.c. decentrali'ed planning staff.d. centrali'ed planning department.e. total 9uality management group.

Answer: d Level: 1 !age: - Type: $

-2. Alabama Airlines has three planning specialists who help division managers develop theirown division plans. 4erving as consultants to the divisions, the planning specialists give

advice about strengths, wea7nesses, opportunities, and threats. Alabama Airlines isutili'ing what approach to the planning functionF

a. =entrali'ed planning departmentb. Kecentrali'ed planning staffc. !lanning tas7 forced. =entrali'ed planning committeee. TO8


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Answer: b Level: !age: - Type: A

-1. All of the following are ways in which companies can bring about relentless drive forprogress E=E!T

a. create an environment that encourages people to eperiment and learn.b. ma7e continuous improvement a way of life.c. avoid stretching goals.d. design a new role for planning staff.e. All of the above are acceptable ways.

Answer: c Level: !age: # Type: $

-. %altimore %rewery allows its line managers to ta7e responsibility for strategic planning.This approach is consistent with which of the followingF

a. =entrali'ed planning departmentb. Kecentrali'ed planning staffc. !lanning tas7 forced. =entrali'ed planning committeee. =ommand0and0control

Answer: c Level: !age: Type: A

-". hich of these refers to a temporary group consisting of line managers responsible fordeveloping strategic plansF

a. !lanning tas7 forceb. Kecentrali'ed planning staffc. =entrali'ed planning departmentd. 4chewhart planning groupe. Total 9uality management group

Answer: a Level: 1 !age: Type: $

S"enario Questions

S"enario()laine )astan

The new program would be focused around 8%5 concepts. Elaine Eastman had been a managerat A%=K for ten years and she was not all certain if this new 8%5 approach was going to fit herdepartment. 4he had strong commitment to achieving the company*s ob6ectives, but she also7new her employees well enough to 7now that some didn*t share the same commitment.


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1. Elaine can anticipate en6oying the advantages of 8%5 which include

a. increased orientation toward goal achievement.b. performance can improve at all company levels.

c. employees are more motivated.d. a P c are correct.e. a, b, and c are correct.

Answer: e Type: A

. Elaine can anticipate and wor7 to prevent the problems of 8%5 which include

a. increase in paperwor7 that leads to a reduction of energy.b. a decrease in communication between managers and employees.c. greater conflict because of opposing goals.d. all of the above.

e. none of the above.

Answer: a Type: A

". >f Elaine dictates or suggests the goals for her employees, she can epect

a. increased motivation from her wor7ers.b. decreased motivation from her wor7ers.c. decreased frustration for her wor7ers.d. decreased intragroup conflict.e. none of the above.

Answer: b Type: A

(. >n the 8%5 process, after the first step of setting ob6ectives is accomplished, the net stepthat Eliane should epect is

a. reviewing progress toward company goals.b. appraising overall performance.c. developing action plans.d. having a company party to celebrate.e. none of the above.

Answer: c Type: A

Short(+ns,er Questions1. AnI is a desired future state that the organi'ation attempts to reali'e.


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Answer: goal !age: "&

. AnI is a blueprint for goal achievement and specifies the necessary resourceallocations, schedules, tas7s, and other actions.

Answer: !lan !age: "&

". The act of determining the organi'ation*s goals and the means for achieving them isreferred to as .

Answer: planning !age: "&

(. JJJJJJ and plans are the responsibilities of middle managers.

Answer: Tactical goals !age: "

. 5perational plans that focus on specific tas7s and processes that help to meet tactical andstrategic goals are developed by JJJJJJ managers and supervisors.

Answer: front0line !age: "

-. JJJJJJ and JJJJJJ facilitate employees/ identification with the organi'ation and helpmotivate them, provide a sense of direction, and allow managers to learn what theorgani'ation is trying to accomplish.

Answer: )oals+ plans !age: "

#. List the five reasons eplicit goals and plans are important.

Answer: Eplicit goals and plans can serve the following functions: legitimacy, source of

motivation and commitment, guide to action, rationale for decisions, and standard ofperformance.

!age: "0(2

&. describes the organi'ation*s reason for eistence.

Answer: mission !age: (1

. AnI JJJJJJJ is a broadly stated definition of basic business scope and operations thatdistinguishes the organi'ation from others of a similar type.

Answer: mission statement !age: (1

12. %road statements describing where the organi'ation wants to be in the future are called


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.

Answer: strategic goals !age: (

11. JJJJJJJ define the action steps by which an organi'ation intends to attain its strategic

goals.Answer: 4trategic plans !age: (

1. )oals that define the outcomes that ma6or departments must achieve in order for theorgani'ation to reach its overall goals are 7nown as JJJJJJJ goals.

Answer: tactical !age: (

1". are designed to help eecute ma6or strategic plans and to accomplish aspecific part of the company*s strategy.

Answer: Tactical plans !age: ("

1(. The specific results epected from departments, wor7 groups, and individuals are the goals.

Answer: operational !age: ("

1. plans are developed at the lower levels of the organi'ation to specifyaction steps toward achieving operational goals and to support tactical plans.

Answer: 5perational !age: ("

1-. List the five characteristics of effective goals.

Answer: )oals should be 1I specific and measurable+ I they should cover 7ey result areas+ "I

they should be challenging but realistic+ (I they should have a defined time period+ and Ithey should be lin7ed to rewards.

!age: (-

1#. is a method whereby managers and employees define goals for every

department, pro6ect, and person and use them to monitor subse9uent performance.

Answer: 8anagement by ob6ectives !age: (#

1&. The most difficult step in 8%5 is JJJJJJJ.

Answer: setting goals !age: (#


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1. List the four ma6or activities that must occur in order for 8%5 to succeed.

Answer: 1I 4et goals, I develop action plans, "I review progress, and (I appraiseoverall performance.

!age: (#0(&

2. 8anagers believe that they are better oriented toward goal achievement whenJJJJJJJJJJ is used.

Answer: management by ob6ectives !age: (#

1. JJJJJJ plans are used to provide guidance for wor70related tas7s that are performedrepeatedly within the organi'ation.

Answer: 4tanding !age: 2

. plans are developed to achieve a set of goals that are not li7ely to berepeated in the future.

Answer: 4ingle0use !age: 2

". JJJJJJJ are ongoing plans that are used to provide guidance for tas7s performedrepeatedly within the organi'ation.

Answer: 4tanding plans !age: 2

(. !lans that define company responses to specific situations, such as emergencies, setbac7s,

or unepected conditions are called plans.

Answer: contingency !age: 1

. A special type of contingency plan that is used when events are sudden and devastatingand re9uire immediate response is called JJJJJJJJ.

Answer: crisis management planning

!age: "

-. hat are the three stages of crisis managementF

Answer: !revention, !reparation, and =ontainment

!age: "

#. >n the JJJJJJ stage of crisis management, the company needs to care for the emotionaland physical safety of its sta7eholders.



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Answer: containment !age:

&. JJJJJJJJ are groups of planning specialists who report directly to the =E5 or presidentof a company.

Answer: =entrali'ed planning departments !age: -

. Although JJJJJJ planning approaches are still popular with some organi'ations, JJJJJJplanning are being critici'ed as inappropriate for today/s fast0paced environment.

Answer: traditional, formal !age: -

"2. A group of planning specialists assigned to ma6or departments and divisions to helpmanagers develop their own strategic plans is called .

Answer: decentrali'ed planning staff !age: -

"1. JJJJJJ planning done by a few individuals in a comple and competitive businessenvironment no longer wor7s.

Answer: Traditional !age: -". List the steps of the new wor7place approach to planning.

Answer:$irst, start with a strong mission. et, set stretch goals. Third, create a culture thatencourages people to eperiment and learn. et, design a new role for planning staff

followed by, ma7e continuous improvement a way of life. Embrace event driven planning.$inally, total support and commitment to the planning process from top management.

!age: #0

"". A temporary group of line managers who have the responsibility of developing a strategicplan is 7nown as anI JJJJJJJ.

Answer: planning tas7 force !age:

"(. List the si guidelines for planning in today/s wor7place.

Answer: 4tart with a strong mission, set stretch goals, create a culture that encourageslearning, embrace event0driven planning, use temporary tas7 forces, and remember thatplanning still starts and stops at the top.

!age: #0



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)ssa- Questions1. >n what ways do plans and goals benefit an organi'ationF

A4E@: !lans and goals benefit the organi'ation in several ways. $irst they provide legitimacy and

a reason for eistence. They also provide a source of motivation and commitment,provide guides for action and decision ma7ing, and they set a standard of performance.

Level: !age: "0(2

. =ompare the four levels of goals and plans.

A4E@:

The highest level is the mission statement, which defines the organi'ation*s basic businessscope and operations and specifies its reasons for eistence. The second level is the levelof strategic goals and plans. Those pertain to the organi'ation as a whole and specifywhere the organi'ation wants to be in the future. The third level is the tactical level, witha focus on outcomes that ma6or divisions and departments must achieve in order for theorgani'ation to reach its overall goals. The fourth and lowest level is theoperational level, involving specific measurable results for departments, wor7 groups, andindividuals.

Level: " !age: (10((

". %riefly define the characteristics of an effective goal.

A4E@: Effective goals are precisely defined and allow for measurable performance. They focus

on the 7ey result areas that contribute most to desired performance. They should bechallenging but not unreasonably difficult. $inally, they should specify the time period thatthey cover and they should be tied to valued rewards.

Level: !age: (0(-

(. List and define the four ma6or activities that must occur in order for management byob6ectives 8%5I to succeed.

A4E@:

The first step is setting goals. The setting of goals involves employees at all levels andshould incorporate the principles of effective goal setting. )oals should be 6ointlydetermined by manager and employee, so as to increase the employee*s level ofcommitment. The second step is developing action plans. These action plans will specify


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how the goals are to be achieved. et, a progress review is important to ma7e sure thatthe action plans are wor7ing. They may be formal or informal and the action plan shouldbe changed if necessary. The last step is to determine if the goals have been achievedwithin the specified time period. This appraisal should factor into the setting of the netperiod*s goals, allowing for feedbac7 into the setting of the net set of goals.

Level: " !age: (#0(&

. Kefine the new planning paradigm and eplain the rationale behind it.

A4E@: The new planning paradigm has four components. $irst, start with a strong mission.

et, stretch goals. Third, create an environment that encourages people to eperimentand learn. et, design a new role for planning staff. $inally, ma7e continuousimprovement a way of life with total support and commitment of top management for theplanning process. This paradigm is based upon the principle of decentrali'ation. >t strives

to involve wor7ers at every level of the company. Kue to the volatility of the businessenvironment, dynamic, timely plans are needed by today*s organi'ations. The compleityof the problems and challenges facing today*s organi'ations mandates that all employees,with their individual perspectives and talents, be involved.

Level: " !age: -0


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