The document discusses decision making and the planning process. It describes how decision making drives the planning process and establishes organizational goals. There are strategic, tactical, and operational goals and plans. Strategic plans outline priorities to achieve strategic goals, tactical plans implement strategic plans to achieve tactical goals, and operational plans focus on carrying out tactical plans to achieve operational goals. Effective planning requires managing barriers like inappropriate goals, improper reward systems, and reluctance to establish goals. Formal goal setting through management by objectives can help integrate planning by involving collaboration between managers and subordinates.

1. Presented By:
Sardar Sikander
Tajamul Farooq
Saffi DAR
Chapter No.07

2. Decision Making and Planning process
Contents:
 Decision Making and the Planning Process
 Organizational Goal
 Organizational Planning
 Tactical Planning
 Operational Planning
 Managing Goal-Setting and Planning Processes

3. Decision Making and Planning process
 Decision making is the cornerstone of planning.
 Decision making is the catalyst that drives the planning
process.
 Deciding on the best plan for achieving particular goals also
reflects a decision to adopt one course of action as opposed to
others.
 Understanding the environment is essentially the first step in
planning.
 Managers must establish the organization’s mission.
 Directly following the mission are strategic

4. The Environmental Context
The Organization’s Mission
∙Purpose ∙Premises ∙Values ∙Directions
Strategic Strategic
goals plans
Tactical Tactical
goals plans
Operational Operational
goals plans
Decision Making and the Planning Process

5. Organizational Goal
“Goals are critical to organizational effectiveness, and
they serve a number of purposes”
Purpose of Goals
 Goals can help everyone understand where the organization is
going and why getting there is important.
 Effective goal setting promotes good planning,and good
planning facilities future goal setting.
 Goals can serve as a source of motivation for
employees of the organization.

6. Kinds of Goals
1. Strategic Goal:
A goal set by and for top management of the organization.
2. Tactical Goal:
A goal set by and for middle managers of the organization.
3. Operational Goal:
A goal set by and for lower level managers of the organization.

7. An organizational plan is basically a “to do” list for and
organization. It lists out the plan of work, programs &
tasks.
 Each specific plan is designed for achieving each specific goal.
 Plans are also distributed according to the time frame in which
they are implemented or act upon.
 Different plans are also prepared by management in order to
tackle any unexpected event.

8. Kinds of Organizational Planning
1. Strategic Plan:
A general plan outlining decisions of resource
allocation,priorities,and action steps necessary to reach
strategic goals.
2. Tactical Plan:
A plan aimed at achieving tactical goals and developed to
implement parts of a strategic plan.
3. Operational Plan:
Focuses on carring out tactical plans to achieve operational
goals.

9. Time Frames for Planning
1. Long range plan:
A plan that covers many years even decades; common long range
plans are for five years or more.
2. Immediate plan:
A plan that generally covers from one to five years.

10. Time Frames for Planning (cont’d)
3. Short range plan:
A plan that generally covers a span of one year or less.
4. Action plan:
A plan used to operationalize any other kind of plan.
5. Reaction plan:
A plan developed to react to an unforeseen circumstances.

11. Contigency Planning and Crisis Management
Contigency Planning:
The determination of alternative courses of action to be taken
if an intended plan is unexpectedly disrupted or rendered
inappropriate.
Crisis Management:
The set of procedures the organization uses in the event of a
disaster or other unexpected calamity.
Ongoing planning process
Action point 1 Action point 2 Action point 3 Action point 4
Develop plan, Implement plan Specify indicators Successfully
Considering And formally For the contigency Complete
Contigency events Identify contigency Events and develop Plan or
Events Contigency plans Contigency
For each possible plan
Event

12. Tactical Planning
Developing Tactical Plans
 The manager needs to recognize that tactical planning must
address a number of tactical goals derived from a broader
strategic goal.
 Tactics must specify resources & time frames.
 It requires the use of human resources.
Executing Tactical Plans
• Successful implementation depends upon astute use of
resources, effective decision making.
• Steps to ensure that right things are done at right time in right
way.
• Ongoing monitoring must be carried out to evaluate
achievement of desired results from plan.

13. Developing & Executing Tactical Plans
Tactical plans are used to accomplish specific parts of strategic plan. Several
tactical plans are used to implement each strategic plan. Effective tactical
planning involves both development & execution.
Developing Tactical Plans Executing Tactical Plans
 Recognize and understand Evaluate each course of action
overarching strategic plans in light of its goal
and tactical goals Obtain and distribute
 Specifying relevant resource information and resources
and time issues Monitor horizontal and vertical
 Recognize and identify human communication and integration
resource commitments of activities.
Monitor ongoing activities for
goal achievements

14. Operational Plans
Types of Operational Plans
Plan Description
Single use plan Developed to carry out a course of action not likely
to be repeated in future.
Program Single use plan for a large set of activities.
Project Single use plan of less scope and complexity than a
program.
Standing plan 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 Standing plan outlining steps to be followed in
procedure particular circumstances
Rules and regulations Standing plans describing exactly how specific
activities are to be carried out.
Organizations develop various operational plans to help achieve operational goals.
In general there are two types of single use plan & three types of standing plan.

15. Managing Goal-Setting and Planning Processes
Barriers to Goal Setting and Planning
Major Barriers Inappropriate goals
Improper Reward System
Dynamic and Complex Environment
Reluctance to Establish Goals
Constraints
Overcoming the Barriers Understanding the purposes of goals and
planning
Communication and Participation
Consistency,Revision and Updating
Effective Reward System

16. Barriers to Goal Setting and Planning
1. Inappropriate Goals:
 Goals may also be inappropriate if they are unattainable.
 Goals may also be inappropriate if they place too much emphasis on
either quantitative or qualitative measures of success.
2. Improper Reward System:
 An improper reward setting acts as a barrier to goal setting and planning.
3. Dynamic and Complex Environment:
 The nature of an organization’s environment is also a barrier to effective
goal setting and planning.
 Rapid change,technological innovation and intense competition can all
increase the difficulty of an organization’s accurately assessing future
opportunities and threats.

17. Barriers to Goal Setting and Planning (cont’d)
4.Reluctance to Establish Goals:
 Managers reluctance to establish goals for themselves and their units of
responsibility.
5.Resistance to Change:
 Another barrier to goal setting and planning is resistance to change.
 Planning essentially involves changing something about the
organization.
6.Constraints:
 Constraints that limit what an organization can do are another major
obstacle.
 Common constraints include a lack of resources, government restrictions
and strong competition.

18. Overcoming the Barriers
1.Understand the Purpose of Goals and Planning:
 Managers should also recognize that there are limits to the
effectiveness of setting goals and making plans.
2.Communication and Participation:
 Everyone involved in the planning process should know what
the over-riding organizational strategy is,what the various
functional strategies are, and how they are all to be integrated
and coordinated.
 People responsible for achieving goals and implementing plans
must have a voice in developing them from the outset.

19. Overcoming the Barriers
3.Consistency,Revision and Updating:
 Goals should be consistent both horizontally and vertically.
 Horizontal consistency means that goals should be consistent
across the organization from one department to the next.
 Vertical consistency means that goals should be consistent up
and down the organization- strategic, tactical and operational
goals must agree with one another.
4.Effective Reward Systems:
 In general, people should be rewarded both for establishing
effective goals and plans and for successfully achieving them.

20. Management by Objectives(MBO)
“ A formal goal- setting process involving collaboration
between managers and subordinates; the extent to
which goals are accomplished is a major factor in
evaluating and rewarding subordinates performance.”
The Nature and Purpose of Formal Goal Setting:
 The purpose of formal goal setting is generally to give
subordinates a voice in the goal-setting and planning processes
and to clarify for them exactly what they are expected to
accomplish in a given time span.
The Formal Goal setting Process:
 If a formal goal-setting program is to be successful, it must start at
the top of the organization.
 The collaboration involves a series of distinct steps.

21. The Formal Goal Setting Process
Communic
Starting Establishment Collaborative ating Periodic Evalua-
The formal of organiza goal setting organi - review tion
Goal tional goals and zational
setting and plans planning goals and
Program
plans
Meeting
Verifiable
goals and
Formal goal setting is an effective technique
Clear plans
for integrating goal setting & planning. This
figure portrays the general steps that most Counselling
organizations use when they adopt formal
goal setting. Of course most organizations
adapt this general process to fit their own Resources
unique needs & circumstances.

22. The Effectiveness of Formal Goal Setting
 A primary benefit of goal setting is improved employee
motivation.
 Goal setting focuses attention on appropriate goals and plans,
helps identify superior managerial talent for future promotion,
and provides a systematic management philosophy that can
have a positive effect on the overall organization.
 The major problem that can derail a goal-setting program is
lack of top management support.
 Another problem with goal setting is that firms overemphasize
quantitative goals and plans and burden their system with too
much paperwork and record keeping.

23. Thank You