Planning Planning andand

Decision MakingDecision Making

Unit 2Unit 2

What is Planning?What is Planning?

It is an intellectual process which is concerned with It is an intellectual process which is concerned with deciding in advance WHAT, WHEN, WHY, HOW, deciding in advance WHAT, WHEN, WHY, HOW, and WHO shall do the work.and WHO shall do the work.

According to Koontz and O’Donell: “Planning According to Koontz and O’Donell: “Planning bridges the gap between from WHERE WER ARE to bridges the gap between from WHERE WER ARE to WHERE WE WANT TO GO.”WHERE WE WANT TO GO.”

Steps in Planning ProcessSteps in Planning Process1. State Organizational Objectives – what the company 1. State Organizational Objectives – what the company wants to achieve in the future.wants to achieve in the future.

2. List alternative ways of reaching objectives – how the 2. List alternative ways of reaching objectives – how the company will achieve the objectives.company will achieve the objectives.

3. Develop premises on which to base each alternatives 3. Develop premises on which to base each alternatives – resources available to the company to achieve the – resources available to the company to achieve the objectives.objectives.

4. Choose the best alternative for reaching objectives – 4. Choose the best alternative for reaching objectives – select which one will be suitable for the company.select which one will be suitable for the company.

5. Develop plans to pursue the closer alternative – 5. Develop plans to pursue the closer alternative – develop options on how to carry it out.develop options on how to carry it out.

6. Put the plans to action – implementation will be 6. Put the plans to action – implementation will be done.done.

Types of PlansTypes of Plans

1. Vision1. Vision Future-oriented declaration of the organization’s Future-oriented declaration of the organization’s

purpose and aspirations.purpose and aspirations. This is what the company wants to become.This is what the company wants to become. Vision of Ibra College of Technology:

“We will be a leading technological institution, providing high quality teaching and learning to prepare and empower the Omani professionals of the future to contribute to national socio-economic development.”

Types of PlansTypes of Plans

2. Mission 2. Mission A written document developed by the A written document developed by the

mangement.mangement. This is what the company does and clearly states This is what the company does and clearly states

why the company esixts.why the company esixts. Mission of Ibra College of Technology:

“To deliver high quality student-centered education that produces competitive graduates who enter the labor market with confidence, strong technological and personal skills, prepared for a life of contribution and success.”

Types of PlansTypes of Plans

3. Strategy 3. Strategy Company’s desired image, direction, and Company’s desired image, direction, and

destination destination what it wants to bewhat it wants to be, , what it wants to what it wants to dodo, and , and where it wants to gowhere it wants to go..

SWOT Analysis, Business Portfolio Analysis, SWOT Analysis, Business Portfolio Analysis, Porter’s Model for Industry Analysis.Porter’s Model for Industry Analysis.

Strategy involves answering many questions, such as: How do you plan to do it? What resources do you have? When do you need to do it?

Types of PlansTypes of Plans4. Objectives 4. Objectives It forms the basis for the action plans.It forms the basis for the action plans. Sometimes referred to as “performance goals.Sometimes referred to as “performance goals. TypesTypes: : short-termshort-term, , intermediate-termintermediate-term and and long-long-

termterm.. Objectives of ICTObjectives of ICT:: Working towards the application of technical and administrative

knowledge in technological and administrative fields in line with the requirements of the labor market.

Meeting the students' needs by creating opportunities for individual, social, academic, technological and vocational development.

Bringing up a generation of highly competent technicians through the provisions of accredited, high quality technological programs.

Types of PlansTypes of Plans

5. Policies, Procedures, Rules, and Budget5. Policies, Procedures, Rules, and Budget PoliciesPolicies – guidelines in decision making. Example: – guidelines in decision making. Example:

Management strongly discourages any employee Management strongly discourages any employee from bringing weapon to work.from bringing weapon to work.

RuleRule – does not allow discretion. Examples: No – does not allow discretion. Examples: No Smoking; No Vandalism.Smoking; No Vandalism.

ProcedureProcedure – required method of handling activities; – required method of handling activities; guides to action. Examples: Registration Procedure, guides to action. Examples: Registration Procedure, Training Procedure, Accounting Procedure.Training Procedure, Accounting Procedure.

BudgetBudget – quantified plans for actions; expressed in – quantified plans for actions; expressed in numbers. Examples: Financial Budget, Sales Budgetnumbers. Examples: Financial Budget, Sales Budget

Levels of PlansLevels of Plans

1. Corporate or Strategic Plan1. Corporate or Strategic Plan Prepared by top management.Prepared by top management. To achieve long-term objectives of the company.To achieve long-term objectives of the company.

2. Tactical or Division Plan2. Tactical or Division Plan Prepared by middle level management.Prepared by middle level management. Consistent with corporate plan.Consistent with corporate plan.

Levels of PlansLevels of Plans

3. Operational or Unit Plan3. Operational or Unit Plan Prepared by lower level management.Prepared by lower level management. Consistent with tactical plan.Consistent with tactical plan. Prepares the schedule of activities of each and Prepares the schedule of activities of each and

every department.every department.

4. Contingency Plan4. Contingency Plan Plan devised for a specific situation when things Plan devised for a specific situation when things

could go wrongcould go wrong Also known as “Back-up Plan”; “Worst-Case Also known as “Back-up Plan”; “Worst-Case

Scenario Plan”; “Plan B”.Scenario Plan”; “Plan B”.

Management by Objectives Management by Objectives (MBO)(MBO)

First described by Peter DruckerFirst described by Peter Drucker

It is a process through which specific It is a process through which specific goals are set collaboratively for the goals are set collaboratively for the organization as a whole and every organization as a whole and every unit and individual within it.unit and individual within it.

Basis for Basis for planningplanning, , managing managing organizational activitiesorganizational activities, and , and assessing and rewarding assessing and rewarding contributionscontributions..

MBO ProcessMBO Process

Organizational goals are set based Organizational goals are set based on the mission.on the mission.

Specific goals are established for Specific goals are established for departments, subunits, and departments, subunits, and individuals.individuals.

Actions plans are formulated. (what, Actions plans are formulated. (what, how, when, where, and by whom?)how, when, where, and by whom?)

Individuals are given the Individuals are given the responsibility.responsibility.

Performance is appraised and Performance is appraised and rewards are given.rewards are given.

Decision MakingDecision Making

What is Decision Making?What is Decision Making?

It is a process of choosing the It is a process of choosing the best alternative for reaching best alternative for reaching objectives.objectives.

DECISIONDECISION is a choice made is a choice made between two or more between two or more available alternatives available alternatives

Decision Making ProcessDecision Making Process

1. Identification of an Existing Problem1. Identification of an Existing Problem Where, when, who was involved, who was affected Where, when, who was involved, who was affected

and how current activities are affected.and how current activities are affected.

2. Develop potential alternatives2. Develop potential alternatives Manager determines available courses of action to be Manager determines available courses of action to be

used to solve the problem.used to solve the problem.

3. Evaluation of alternatives3. Evaluation of alternatives Merits and demerits of various alternatives should be Merits and demerits of various alternatives should be

compared through a judgment criteria.compared through a judgment criteria.

Decision Making ProcessDecision Making Process

4. Select the best alternative4. Select the best alternative Selection is based upon Selection is based upon feasibilityfeasibility, , effectivenesseffectiveness, and , and

carries the lowest costscarries the lowest costs..

5. Implementing the chosen alternative5. Implementing the chosen alternative Devise programs, procedures, rules, or policies.Devise programs, procedures, rules, or policies.

6. Gathering problem-related feedback6. Gathering problem-related feedback Managers need to figure out what went wrong and Managers need to figure out what went wrong and

ask different questions.ask different questions.