Chapter 9 Flashcards
What and Why of Planning?
Planning
* A management function that involves defining goals, establishing a strategy for achieving those goals, and developing plans to integrate and coordinate work activities.
Why do Managers Plan?
* Planning provides direction.
* Planning reduces uncertainty.
* Planning minimizes waste and redundancy.
* Planning establishes the goals or standards.
Relationship Between Planning and Performance?
Formal planning is associated with higher profits and returns on assets
The quality of planning and implementation affects performance more than the extent of planning.
The external environment can reduce the impact of planning on performance.
Formal planning must be used for several years before planning begins to affect performance.
Goals and Plans (1 of 4)
Goals and Planning
* Goals (also objectives)
– Desired outcomes or targets.
– Provide direction and performance evaluation criteria.
* Plans
– Documents that outline how goals will be met.
– Describe how resources are to be allocated and establish activity schedules.
Types of goals?
Stated goals: official statements of what an organization says, and what it wants its stakeholders to believe its goals are.
Real goals: goals that an organization actually pursues, as defined by the actions of its members.
Types of plans?
Breadth:
Strategic Plans: plans that apply to the entire organization and establish the organization’s overall goals.
Operational plans: plans that encompass a particular operational area of the organization.
Time Frame:
Long-term plans: plans with a time frame beyond three years.
Short-term plans: plans covering one year or less.
Specificity:
Directional plans: plans that are flexible and set out general guidelines.
Specific plans: Plans that are clearly defined and leave no room for interpretation.
Frequency of use:
Single-use plan: a one-time plan specifically designed to meet the needs of a unique situation standing plans
Ongoing plans: provide guidance for activities performed repeatedly.
Setting Goals and Developing Plans (1 of 6)
Approaches to Setting Goals
Traditional Goal Setting: An approach to setting goals in which top managers set goals that then flow down through the organization and become subgoals for each organizational area.
Goals are intended to direct, guide, and constrain from above.
Goals lose clarity and focus as lower-level managers attempt to interpret and define the goals for their areas of responsibility.
Approaches to Setting Goals (cont.)
Means–ends chain: an integrated network of goals in which the accomplishment of goals at one level serves as the means for achieving the goals, or ends, at the next level.
Management by objectives (MBO): a process of setting mutually agreed upon goals and using those goals to evaluate employee performance.
– It consists of four elements: goal specificity; participative decision making, an explicit time period, and performance feedback.
Steps in goal setting?
- Review the organization’s mission, or purpose.
- Evaluate available resources
- Determine the goals individually or with input from others.
- Write down the goals and communicate them to all who need to know.
- Review results and whether goals are being
What are Well Written Goals?
- Written in terms of outcomes rather than actions
- Measurable and quantifiable
- Clear as to a time frame
- Challenging yet attainable
- Written down
- Communicated to all necessary organizational members
What is SMART?
- Specific: The goal is somewhat specific in that it mentions achieving financial security and investing in property, paying off school debt, and building work experience. However, it could be more precise by specifying exact financial targets, such as a specific amount of savings, investment, or debt reduction.
- Measurable: The goal lacks specific metrics or numbers to measure progress. To make it measurable, you should include quantifiable targets, such as saving a specific amount of money or reducing student loan debt by a certain percentage.
- Achievable: The goal appears to be achievable within the given time frame of 3-6 years, assuming that your financial situation and income allow for these objectives. However, you should perform a detailed financial analysis to ensure that these goals are indeed realistic and attainable.
- Relevant: The goal seems relevant to your personal and financial aspirations, including becoming financially secure and investing in property. However, it’s essential to ensure that these objectives align with your broader life and career goals.
- Time-bound: The goal is somewhat time-bound as it specifies a range of 3-6 years. To make it more time-bound, you could set a specific target date by which you want to achieve these financial goals.
What is Contingency Factors in Planning?
Organizational Level:
– Strategic plans at higher levels.
– Operational plans at lower levels.
Degree of environmental uncertainty:
– Stable environment: specific plans.
– Dynamic environment: specific but flexible plans.
Length of future commitments:
– Current plans affecting future commitments must be sufficiently long-term to meet the commitments.
Current Issues in Planning (1 of 5)
Effective Planning in Dynamic Environments
- Develop plans that are specific but flexible.
Example: unexpected events such as the COVID-19
pandemic. - Understand planning is an ongoing process.
- Change plans when conditions warrant.
- Persistence in planning eventually pays off.
- Flatten the organizational hierarchy to foster the development of planning skills at all
organizational levels.
How Can Managers Use Environmental Scanning?
- Environmental scanning: Screening information
to detect emerging trends. - Competitor intelligence: Gathering information
about competitors that allows
