Transcript Elements of Planning Copyright © Houghton Mifflin Company. All rights reserved. 7–1

Elements of Planning
Copyright © Houghton Mifflin Company. All rights reserved.
7–1
Organizational Goals
Purposes of Goals
Guidance and
unified direction
Promotion of
good planning
© 2010 South-Western, Cengage Learning, Inc. All rights reserved.
Source of
motivation
Evaluation
and control
7–2
Kinds of Goals
Setting Organizational Goals
By Level
By Area
Time Frame
Mission statement
Strategic goals
Tactical goals
Operational goals
Operations
Marketing
Finance
Production
Long-term goals
Intermediate goals
Short-term goals
Explicit goals
Open-ended goals
© 2010 South-Western, Cengage Learning, Inc. All rights reserved.
7–3
Kinds of
Organizational
Goals for a
Regional FastFood Chain
7–4
Creating S.M.A.R.T. Goals
Specific – Be clear about what you want to accomplish.
Measurable – Put in quantifiable terms to track your progress.
Attainable – Make it challenging, but attainable.
Realistic – Be willing and able to work toward.
Timely – Include a time frame, have due dates for milestones.
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7–5
Kinds of Organizational Plans
• Strategic Plans
(Top Management)
– Broadest set of plans – primary objectives
– Mission statement
• Tactical Plans (Middle Management)
– Smaller scale – used to implement a strategy
– Typically 1-3 year period
• Operational Plans (Supervisory Management)
– Designed to implement tactical plans
– Typically 1 year or less
– Deals with the “how” in accomplishing specific
objectives
• Contingency Plans (Any management level)
– Alternative courses of action
• The Time Dimension of Planning
– Planning must provide sufficient time to fulfill the managerial
commitments involved.
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5
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Long-range (strategic)
plans of 5 or more years
Intermediate-range
(tactical) plans of 1–5 years
Short-range (operational)
action and contingency
plans of 1 year or less
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Plan Type
Description
Single-use plans
Developed to carry out a course of action not likely to be
repeated in the future
Program
Single-use plan for a large set of activities
Project
Single-use plan of less scope and complexity than a program
Standing plans
Developed for activities that recur regularly over a period of
time
Policy
Standing plan specifying the organization’s general response
to a designated problem or situation
Standard operating
procedure
Standing plan outlining steps to be followed in particular
circumstances
Rules and regulations
Standing plans describing exactly how specific activities are to
be carried out
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Example of Policy, Rule, and Procedure
Policy: (manager has some discretion)
Accept customer returns
Rule: (no exceptions)
No returns over $50 without a managers signature
Procedure:
Outline steps to be followed in particular
circumstances
(SOPs- Standard Operating Procedures)
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7–9
Barriers to Goal Setting and Planning
Major barriers
Inappropriate goals
Improper reward system
Dynamic and complex environment
Reluctance to establish goals
Resistance to change
Constraints
Overcoming
the barriers
Understanding the purposes of goals and planning
Communication and participation
Consistency, revision, and updating
Effective reward system
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7–10
The Formal Goal-setting
Process
Management By Objectives (MBO)
•Goals are collaboratively set between managers and subordinates
•Evaluation and reward based on subordinate’s performance
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7–11