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merly tataro

on 11 November 2014

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Transcript of PLANNING

Characteristics of Planning
Planning Terminologies
Perspective in Planning
is a blue print for goal achievement and specifies the necessary resource allocations, schedules, and other actions.
s a desired result that a person/org. wishes to achieve. It is a target that a person/org. wants to reach. It is an end-point of where a person sees himself after a certain period of time.
are more concrete and are clearly defined by certain steps that will eventually allow the person to fulfill that particular objective. Objectives are often short term and have a limited amount of time frame.
specify future ends;
specify today’s means/resources. The term
usually incorporates both ideas; it means determining the organization’s goals and defining the means for
achieving them
Types of Goals
( 3 levels of goals in the organization)
Strategic goals
= broad statement of where the organization wants to be in the future. They pertain to the organization as a whole rather than to specific divisions or departments. They are the stated intentions of what the organization wants to achieve.
Tactical objectives
= the results that departments /divisions within that the organization intend to achieve.
= major sub-units must do its share of responsibilities of attaining its objectives in order for the organization to achieve its over-all goal.

Operational Objectives
= specific, precise and measurable results are expected from the different
divisions, work groups and individuals.

The planning process
starts with a formal mission that defines the basic purpose of the organization. The company-wide strategic goals are determined and form the basis for the organization’s lower level objectives.
is specifying the goals to be achieved and deciding in advance the appropriate actions to be taken to achieve those goals. Planning activities include analyzing current situations, anticipating the future, determining objectives, deciding in what types of activities and determining resources needed to achieve goals.
is deciding in advance what to do, how to do it, when to do it, who is to do it, and how to measure performance(Hick and Gullet 19760). It bridges the gap from where we are now to where we want to go.
Vision =
Nonspecific directional and motivational guidance for the entire organization. Top managers normally provide a vision for the business. It is the most emotional of the four levels in the hierarchy of purposes.
Mission =
an organization's reason for being. It is concerned with scope of the business and what distinguishes this business from similar businesses. Mission reflects the culture and values of top management.

1. Goal-directed
2. Primacy of Planning
3. Pervasiveness of Planning
4. Efficiency of Plans
1. To offset uncertainty and change .
2. To focus attention on objectives
3. To gain economical and efficient operations
4. To facilitate control
1. satisficing perspective
2. optimizing perspective
3. adaptizing perspectve
1. Strategic Planning
2. Tactical Planning
3. Operational Planning
= is a general guide to action. It is a general statement based on the organizaiton’s over-all goals and strategic plans that provide directions for people within the organization. It may define boundaries within which to make decisions.
Procedures =
define a precise series of steps to be used in achieving certain objectives. Procedures are very specific and typically apply to individual jobs.
Rules =
describe how a specific action is to be performed.
= is a complex set of objectives and plans for attaining an important, one-time organizational goal. The program is designed to carry-out a major course of action for the organization.
Project =
is also a set of objectives and plans designed to achieve a one-time goal but generally is smaller in scope and complexity than a program.
PLANNING TIME HORIZON( for organizational goals and plans)
Long-term planning =
includes strategic goals and plans and may extend for as long as 5 to 10 years into the future.
Intermediate –term planning
= tactical objectives – one to two years
Short-term planning =
operational objectives for specific departments and individuals – one year or less
Planning Modes and Forms
1. Inactive Mode
2. Reactive Mode
3. Preactive Mode
4. Interactive Mode
1. Growth
Product Expansion

Personnel Expansion
Plant Expansion
Additional Facilities
Additional Income
2. Non-growth
3. Risk-reduction
4. Acquisition and Merger
5. Diversification
horizontal diversification
Company increases its mix of products for the same and existing market.
vertical diversification
Company produces its own components.
concentric diversification
when a company goes into an entirely new line
when one company enters into many areas
6. Multinational
huge companies may decide to engage or invest in several countries by setting up multinational corporation .
7. liquidation
a strategy used by helpless companies due to unfair competition, lack of budget, etc
A vision might be a picture, image, or description of the preferred future. A visionary has the ability to foresee something and sees the need for change first.
Microsoft's early vision statement was
"A Computer on Every Desk and In Every Home."

Many people might think that Revlon's mission is to make cosmetics. Yet, Revlon provides glamour, excitement and innovation. Charles Revson, Revlon's founder understood the importance of mission. He said
"In the factory, we make cosmetics; in the store, we sell hope."
should be realistic, specific, challenging, should also be quantifiable to both managers and employees.
precedes the execution of all other managerial functions
is a function of all managers, whatever their responsibilities are, all do planning
it is measured by the amount it contributes to the attainment of organization’s purpose and objectives
allows the organization to determine the constraints, specify the objectives, select the number of options, monitor and control the implementation so as to allow replanning if necessary.
it unifies the activities of the different parts of an organization to act as one party
minimizes costs, emphasis is on efficient and effective operations and consistency of procedures and methods
Managers cannot always check on the accomplishments or failure of their subordinates. There is very little time and energy to do this. It is important to have goals against which to measure the performance of people or units.
(Herbert Simon) coined to designate efforts to attain some level of satisfaction but not necessarily to exceed it
To “satisfice” is to do “well enough” but not necessarily as “well as possible.”
Objectives are feasible and achievable. This is deemed so when they are measurable.
The “satisfier-planner” goes by what happened in the past and restricts his planning to the money-source. A realist and aims only for what can really be done. Research is not crucial to him. He is the contended cow, so to speak.
Goals are very quantitative; goals that cannot be quantified are ignored
The optimizing planner seeks the best policies, programs, and projects by using mathematical models.
The aim is to use minimum resources for maximum results. Values and human relations, including
a. the benefit from planning is not in the plan that comes out of planning but the very process itself. People participate, begin to understand the system, arrive at solutions themselves – though not always the best alternative. But the important thing is that the participants go through the cycle of planning. And this is more important than the plan document itself.
b. Planning is flexible. Thus, the planner carried out commitment planning for those aspects in the future that they are certain, carry out contingency planning for those aspects that they are not too certain, and carry out responsive planning for those aspects in the future that planner does not know about.
1. Where are we now?
2. Where do we want
to be?
3. How do we get

(1)perform internal and external environmental analyses
(2)review vision, mission and objectives
(3)determine SWOT: Strengths, Weaknesses, Opportunities and Threats. SWOT analysis requires managers to be honest, self-disciplined and thorough. Going on to strategy choices without a comprehensive SWOT analysis is risky.
= involves making decisions about the organization’s long-term goals and strategies.
= the process of developing and analyzing the organization's mission, overall goals, general strategies, and allocating resources.
planning done by middle level managers
translates broad strategic goals and plans that are relevant to a definite portion of the organization often a functional area like marketing or human resources
the following
1. formulating
2. planning
3. formulating
4. working
5. deciding
on plant
6. deciding
planning done by front-line managers
identifies the specific procedures and process required at lower levels of the organization
Operational plans include policies, procedures, methods, and rules. The terms themselves imply different degrees of scope
Operational planning includes the following activities
1. controlling
2. monitoring the
of policies
3. controlling
4. scheduling
The company depends on the state of their craft and their knowledge of the business.
holistic/systems approache
1. Growth
1. Single-use plans
= designed to achieve a set of goals that are not likely to be repeated in the future.
2. Standing plans
focus on on-going set of goals. For example, many companies have standing plans for the effort to recruit minorities and women. Frequently, standing plans become more permanent policies and rules for running the organization.
3. Contingency plans
set of actions to be taken when companies initial plans have not worked well or in events in the external environment require a sudden change.
decision-maker must evaluate the advantages, disadvantages, and potential effects of each alternative goal and plan
must prioritize those goals and eliminate some from further consideration.
needs to consider the implications of alternative plans designed to meet high-priority goals.
the planner is now in a position to select the most appropriate of feasible goals and plans
Once goals and plans are selected, they must implement the plans to achieve the goals. The plans are useless unless they are implemented properly
because planning is on-going, repetitive process, managers must continually monitor the actual performance of their work units according to the units goals and plans
Also, they must develop control systems that allow the organization to take corrective action when the plans are implemented improperly or when the situation changes.
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