Badua, AdrianUltado, John Benjamin

After discussing this section you should be able to:

1. discuss the costs and benefits of planning.

2. describe how to make a plan that works.

PlanningA primary functional managerial activity that involves:

Defining the organization’s goals Establishing an overall strategy for achieving

those goals Developing a comprehensive set of plans to

integrate and coordinate organizational work.

Informalnot written down, short term focusspecific to an organization.

FormalInvolved shared goals for the

organizationWrittenSpecificLong term focus

Purposes of PlanningProvides directionReduces uncertaintyMinimizes waste and redundancySets the standards for controlling

The BenefitsThe Pitfalls of Planning

Intensified Effort

Persistence

Direction

Creation of Task

Strategies

It Works!

Impede Change & Prevent

Adaptation

Create a False

Sense of Certainty

Detachment of Planners

Leaders must have a visionPlanners must be close to eventsPlans must be flexible

Set Goals

DevelopCommitment

to Goals

DevelopEffective Action

Plans

Track ProgressToward GoalAchievement

MaintainFlexibility in

Planning

Adapted from Exhibit 4.1

Specific

Measurable

Attainable

Realistic

Timely

The determination to achieve a goalIncreased by:

Setting goals through participationMaking goals reasonableMaking goals publicObtaining top management support

For accomplishing a goal, these list the:specific stepspeopleresourcestime period

One method, setting:proximal goals - short-termdistal goals - long-term

Second method:gather and provide performance feedbackmake adjustments in:

effortdirectionstrategies

Option-based planningkeep options open through simultaneous

investmentinvest more in promising options

Learning-based planningplans need to be continuously adjustedencourages frequent reassessment and

revision of goals

After discussing this section you should be able to:

3. discuss how companies can use plans at all management levels, from top to bottom,

4. describe the different kinds of special-purpose plans that companies use for change, contingencies, and product development.

Vision

Adapted from Exhibit 4.3

Vision

Mission

TacticalPlans

Managementby

Objectives

OperationalPlans

StandingPlans

Single-UsePlans

Adapted from Exhibit 4.4

TopManagers

MiddleManagers

First-LevelManagers

Visionstatement of purposeenduring, inspirational, clear, and consistent

with company beliefs and valuesMission

flows from visionmore specific goal statements

Targetingset a clear, specific target

Common-Enemyvow to defeat a rival

Role-Modelemulate a successful company

Internal-Transformationstrive to dramatically change the company

Tactical Plansspecify how a company will use resources,

budgets, and people to accomplish goalsManagement by Objectives

develop and carry out tactical plansfour steps

discuss goalsparticipatively select goalsjointly develop tactical plansmeet to review performance

Management by Objectives (MBO)

MBO & Production

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%Probability of success 97%

68%

MBO is based on goals, participation and feedback. Companies that use

MBO are 97% more likely to outproduce companies that don’t!

Operational plansday-to-day plans

Single-use planscover one-time-only events

Standing plansplans for recurring eventsthree kinds

policiesproceduresrules & regulations

Budgeting

Planningfor

Change

Planningfor

Contingencies

Planningfor

ProductDevelopment

Stretch goalsextremely ambitious goalsinitially employees don’t know how to

accomplishBenchmarking

identify outstanding practices in other companies

adapt them to your company

Stretch goals are more than just demanding more from employees

Give employees the tools to succeedDon’t punish failure

Steve Kerr on Stretch Goals at GE

Define the scope of the scenario

Identify the major stakeholders

Identify environmental trends

Identify key uncertainties and outcomes of these trends

Using steps 1-4, create initial scenarios

Check each scenario for consistency and plausibility of facts

Create contingency plans from each scenario

Aggregate product plansFour keys to faster product development

cross-functional teamsinternal and external communicationoverlapping development phasesfrequent testing of product prototypes

January July January July JulyJanuary

Block DiagramEvolution of System SpecificationSimulation

ASIC and Board Design

Hardware Mock-ups & Models

“Bring-up”

FullSystem

Prototype

ShipDate

Conceptualization Simulation ImplementationAdapted from Figure 4.7

http://www.swlearning.com/management/williams/m2e/.../powerpoint/ch04.ppt

http://www.slideshare.net/waky/chapter-5-planing-and-dicision-making http://ctb.ku.edu/en/table-of-contents/leadership/effective-manager/

management-plan/main http://www.udemy.com/blog/planning-in-management/ http://www.udemy.com/blog/planning-in-management/ Williams, Chuck, (2009), Management, Planning, 157-169. Shahrol Aman Ahmad, Azhari Ramli, Nasri Nalimi, Azelin Aziz, Dr. Santhi

Raghavan, (2009), Fundamentals Of Management, Planning and Decision Making, 35-46.

Quin, Susan, (2010), Management Basics, Planning in the Organization, 18-22.

Boeing vs Airbus Reference:http://www.123helpme.com/boeing-vs-airbus-view.asp?id=161013http://www.123helpme.com/boeing-management-planning-view.asp?id=163866Douglas A. Irwin, Nina Pavcnik, (2003), Airbus versus Boeing Revisited: International Competition in the Aircraft Market www.swlearning.com/management/williams/m2e/.../powerpoint/ch04.ppt

Cola Wars: The New Coke Reference:http://www.123helpme.com/coca-cola-versus-pepsi-cola-view.asp?id=164247http://www.123helpme.com/cola-war-case-view.asp?id=164246http://www.123helpme.com/view.asp?id=63733

Ford Motor Company Reference:Williams, Chuck, (2009), Management, Planning, 155.

Video Reference:https://www.youtube.com/watch?v=3y0Jja52B2o