Chapter 7

Question 1

Characteristics of planning

Answer 1

• Goal orientated
• Looks ahead
• Intellectual process
• Choice and decision-making
• Primary function of management
• Continuous process
• All pervasive
• Designed for efficiency
• Flexible

Question 2

Importance of planning

Answer 2

• Offset uncertainty and change
• Focus organisational activity as required for a specific purpose
• Co-ordinated, systematic road map
• Increase economic efficiency
• Control establishing

Question 3

Advantages of planning

Answer 3

• Facilitates management by objectives
• Minimises uncertainties by anticipating the future
• Facilitates co-ordination around organisational goals
• Improves employee morale
• Helps in achieving economies
• Facilitates control
• Provides a competitive edge
• Encourages innovation

Question 4

Disadvantages of planning

Answer 4

• Rigidity
• Misdirected planning
• Time consuming
• Probability in planning
• False sense of security
• Expensive

Question 5

How to facilitate planning

Answer 5

1. Develop organisational climate which encourages planning
2. Top-level management should support lower level planning activities
3. Top-management should serve as role models
4. Training around planning
5. Encourage planning and supports planning, avoid punishment
6. Avoid planning for the sake of it, use them once established

Question 6

What are the steps in planning

Answer 6

1. Awareness of current state - focus on current status, commitments, strengths and weaknesses, use those to develop the vision
2. Establish outcomes and goals - decide where it is heading and where it will hopefully end up, managers at different levels will set different goals, consider the use of goal planning to make action statements or direction planning or hybrid planning
3. Premising - establish assumptions on which action statements are built, they will determine how successful the plans are, assumptions should be monitored and updated
4. Determine the course of action required - decide how to move from step 1 to the goal determined in step 2, develop action statement look at what, when, how, who
5. Formulate supportive plans - the general plan will need supportive plans to bolster the main plan

Question 7

SMART goals

Answer 7

S: specific
M: measurable
A: attainable
R: relevant
T: time-bound

Question 8

Explain:

Strategic planning

Answer 8

• Defines long-term vision
• 1 to 5 years
• Business owners and top management
• Identify potential challenges and steps taken to avoid them
• Broad plans, help to determine resources
• Vision and mission statements, goals and objectives, SWOT analysis, action plans and KPIs
• Vision statement - what the organisation aspires to be
• Mission statement - action-orientated used as a roadmap for the vision statement

Question 9

Explain:

Tactical planning

Answer 9

• Implementation of the strategic plan
• “How do we achieve our strategic plan?”
• Smaller, distinct short-term plans
• 1 year or less
• More specific and narrower in focus than the plans they support
• Quick decisions, diversion, contingency plan to identify opportunities and prevent threats

Elements:
* Goals, Tactics, Actions, Resources, Timeline

Question 10

Explain:

Operational planning

Answer 10

• Direction and action statements for the activities in the organisation’s technical core
• Highly detailed information that relates to specific functions and roles
• WHAT, WHO, WHEN, HOW MUCH
• Details how to use organisational resources to pursue the strategic plan

Forms part of:
* Business plan
* Go-to-market strategy
* Budgets
* Maintenance plan
* Sales and operational planning
* Projects

Question 11

Explain:

Contingency planning

Answer 11

• What if plan
• Set to deal with the situation if assumptions set during planning stage are incorrect
• Develop an alternative course of action should the original course of action be disrupted