Definition of Planning Planning involves selecting missions and objectives and the actions to achieve them; it requires decision making, that is, choosing from among alternative future courses of action.Close Relationship of Planning and ControllingTypes of PlansPlans can be classified as:1. Missions or purposes2. Objectives or goals3. Strategies4. Policies5. Procedures6. Rules7. Programs8. BudgetsTypes of Plans The mission, or purpose, identifies the basic purpose or function or tasks of an enterprise or agency or any part of it. Objectives, or goals, are the ends toward which activity is aimed.
Strategy is the determination of the basic long term objectives of an enterprise and the adoption of courses of action and allocation of resources necessary to achieve these goals. Policies are general statements or understandings that guide or channel thinking in decision making.Types of Plans – contd… Procedures are plans that establish a required method of handling future activities. Rules spell out specific required actions or non-actions, allowing no discretion. Programs are a complex of goals, policies, procedures, rules, task assignments, steps to be taken, resources to be employed, and other elements necessary to carry out a given course of action. A budget is a statement of expected results expressed in numerical terms.Steps in PlanningVerifiable Objectives Objectives are the important ends toward which organizational and individual activities are directed. An objective is verifiable when at the end of the period one can determine whether or not the objective has been achieved.
Relationship of Objectives and the Organizational HierarchyEvolving Concepts in MBO Management by objectives is a comprehensive managerial system that integrates many key managerial activities in a systematic manner and is consciously directed toward the effective and efficient achievement of organizational and individual objectives.Systems Approach to MBO
Benefits of Management by ObjectivesClear Goals: Motivate. Improve managing through results-oriented planning. Clarify organizational roles, structures, and the delegation of authority. Encourage commitment to their personal and organizational goals. Facilitate effective controlling, measuring of results, and implementation of corrective actions.Definition of Strategy and Policies Strategy is the determination of the mission (or the fundamental purpose) and the basic long- term objectives of an enterprise, and the adoption of courses of action and allocation of resources necessary to achieve these aims.
Policies are general statements or understandings that guide managers thinking in decision making.The Strategic Planning ProcessThe Strategic Planning Process Inputs to the organization Industry analysis Enterprise profile Orientation, values, and vision Mission (purpose), major objectives, and strategic intent Present and future external environment Internal environment
The Strategic Planning Process – contd.. Development of alternative strategies Evaluation and choice of strategies Medium- and short-range planning Implementation through reengineering, staffing, leadership, and control Consistency testing and contingency planningMission, Objectives, and Strategic Intent Mission relates to the kind of business. Objectives are the end points for activities. Strategic intent is the commitment to win in the competitive environment.Definition of the TOWS Matrix The TOWS Matrix is a conceptual framework for a systematic analysis that facilitates matching the external threats and opportunities with the internal weaknesses and strengths of the organization.TOWS Matrix: 4 Alternative Strategies SO strategy: Maxi–Maxi WO strategy: Mini–Maxi ST strategy: Maxi–Mini WT strategy: Mini–MiniTOWS Matrix for Strategy Formulation