UNIT 2: Planning The Planning Process and Types of Plans.
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Transcript of UNIT 2: Planning The Planning Process and Types of Plans.
PlanningThe process of setting objectives
and determining how to accomplish them.
Helps anticipate problems before they happen
Bridges the gap between where the business is now and where it wants to be.
Why and how do managers plan?
Steps in the planning process:1. Define your objectives.
2. Determine where you stand vis-à-vis objectives.
3. Develop premises regarding future conditions.
4. Analyze and choose among action alternatives. Create plan, policies, and procedures
5. Implement the plan and evaluate results.
Benefits of planning:
Improves - Focus and Flexibility
Action Orientation
Coordination
Time Management Time Management Link
Control
The management function that involves setting performance objectives and deciding how to meet those objectives is referred to as _____________.
1. leading2. planning3. controlling4. organizing
Which one of the following is not one of the benefits of planning?
1. flexibility2. coordination3. time management4. disorder
Think – Pair - Share
What kind of a planner are you? What importance does planning play in your life? When you are assigned a major project in school,
do you map out a plan for completing it? Do you manage your time well? Do you prioritize important tasks to make sure
they are completed first? What is the biggest “time waster” that prevents
you from completing essential tasks on time? Have you created a plan for what you will do after
completing high school?
What types of plans do managers use?
Short-range and long-range plans Short-range plans = 1 year or less Intermediate-range plans = 1 – 2 years Long-range plans = more than 3 years
Top or Higher management levels focus on setting long-range plans and directions for the organization.
Lower management levels focus on short-range plans
What types of plans do managers use?
Strategic and operational plans Strategic plans — set broad, comprehensive, and
longer-term action directions for the entire organization.
Operational plans — define what needs to be done in specific areas to implement strategic plans.
Production plans Financial plans Facilities plans Marketing plans Human resource plans
What types of plans do managers use?
Policies and procedures Standing plans
Policies and procedures that are designed for repeated use.
Policy Broad guidelines for making decisions and
taking action in specific circumstances. Rules or procedures
Plans that describe exactly what actions are to be taken in specific situations.
What types of plans do managers use?
Budgets and project schedulesSingle-use plans
Only used once to meet the needs and objectives of a well-defined situation in a timely manner.
Budgets Single-use plans that commit resources to
activities, projects, or programs. Projects
One-time activities that have clear beginning and end points.
Project management makes sure project activities are completed according to project schedules.
The type of plan that sets the broad, long-term direction for a business is called a(n) __________ .
1. Budget2. Operational Plan3. Strategic Plan4. Matrix
What are the useful planning tools and techniques?
Forecasting Process of predicting what will happen in the
future. Qualitative forecasting uses expert opinions. Quantitative forecasting uses mathematical
and statistical analysis. All forecasts rely on human judgment. Planning involves deciding on how to deal with
the implications of a forecast.
What are the useful planning tools and techniques?
Contingency planning Identifying alternative courses of action
that can be implemented to meet the needs of changing circumstances.
Contingency plans: anticipate changing conditions. contain trigger points.
What are the useful planning tools and techniques?
Scenario planning A long-term version of contingency
planning.
Identifying alternative future scenarios.
Plans made for each future scenario.
Increases organization’s flexibility and
preparation for future shocks.
In early 1973, Pierre Wack, head of Corporate Planning for Royal Dutch/Shell, was frustrated. He was frustrated because he felt that Shell (and indeed the entire world) was operating on the basis of two questionable assumptions: that the supply of oil would remain plentiful and that the price of oil would remain low. Wack developed an approach now referred to as Scenario Planning. Wack presented a series of short stories (or scenarios) about possible futures to senior management at Shell. In one scenario, an accident in Saudi Arabia led to the severing of an oil pipeline, which in turn, decreased production and thus supply, creating a market reaction that increased oil prices, allowing OPEC nations to pump less oil but make more money. Senior management, when confronted with the scenario, re-examined its assumptions about oil price and supply. Investigating further, they concluded that OPEC was preparing to increase oil prices. When the oil price shocks of 1973 hit, Shell was the only major western company (or nation for that matter) that was prepared. Within two years, Shell moved from the eighth biggest oil company to the second.
Willmore, Joe, “Scenario Planning: Creating Strategy for Uncertain Times”, Information Outlook 9.1.2001 available online
What are the useful planning tools and techniques?
Benchmarking
Use of external comparisons to better
evaluate current performance and
identify possible actions for the future.
Adopting best practices of other
organizations that achieve superior
performance.
What are the useful planning tools and techniques?
Participation and involvement Include all the people who will be affected and/or
asked to implement the plan in the planning steps. Benefits of participation and involvement:
Promotes creativity in planning. Increases available information. Fosters understanding, acceptance, and
commitment to the final plan.
A planning strategy that involves comparing performance and plans against a standard or best practice is called ________________.
1. Participatory Planning2. Scenario Planning3. Benchmarking4. Contingency Planning
A planning strategy that identifies alternative courses of action that can be followed if circumstances change is called ____________________.
1. Participatory Planning2. Scenario Planning3. Benchmarking4. Contingency Planning
The type of plan that sets the broad, long-term direction for a business is called a(n) __________ .
1. Budget2. Operational Plan3. Strategic Plan4. Matrix
Time Management Techniques Use a time management matrix.
This technique will enable you to challenge and question your own habits, routines, and practices.
Decide when to look at your emails and instant messages. turn off the pop-up or noise that tells
you when you have received email. Use a diary or activity planner. Create a weekly schedule Effective To Do List
Funny Link