Organizational planing & decision making process

1. ORGANIZATIONAL
PLANNING
& DECISION
MAKING PROCESS
PESC MBA Program Organizational Planning Assignment by G1 Members
1
By Group 1 Members
A Group Assignment to be Presented for management Theory & Practice Course Instructor

2. 2
Group I members
1. Sara Jemal
2. Shimelis Birhanu
3. Setegn
4. Selamawit Wolde
5. Solomon T/Markos
6. Sisay
PESC MBA Program Organizational Planning Assignment By G1 Members

3. 3
Presentation Out Line
 Definition of planning
 Planning Terminologies
 History of planning
 Types of planning
 Planning Skills
 Features of Good planning
 SWOT & SMART Approach
 Barriers & Limitation
of planning ?
 Why planning fails?
 Practical Experience
Sharing

4. 4
Presentation Objectives
1. Provide an overview of an organizational planning &
Decision Making activities & process.
2. Describe the purpose & future of planning
3. Identify basic required skills to develop planning
4. Identify common barriers and limitations of planning.
5. To illustrate real organizational planning practice

5. 5
1.1 DEFINATION OF PLANING
A) Basic Managerial Function
PESC MBA Program Organizational Planning Assignment By G1 Members

6. 6
1.1 Definition of planning Cont.…
 If you fail to plan, you are planning to fail”
 “If you don’t know where you are going, you’ll end up
someplace else.” Yogi Berra,
 “Without the activities determined by planning, there would be
nothing to organize, no one to activate and no need to control”.
George R. Terry
PESC MBA Program Organizational Planning Assignment By G1 Members

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1.1 What Is planning ???
 Planning is deciding in advance what is to be done in
future, when, where and by whom it is to be done.
 A blueprint specifying the resource allocation,
schedules, and other actions necessary for attaining
goals.
 Planning is preparation for action & its a means to an end
 It is a process of thinking before doing.

8. 1.2 PLANINING TERMINOLOGIES
 Mission
 Reason of Existence
 Vision
 A desired future state
 Values
 A philosophical priorities
 Goal
 A desired future attempts
to realize
 Objectives
 The ends toward which
activity is directed
8
 Strategies
 A program to attain Object.
 Policies
 A framework for making
decisions
 Plan
 Specifying & organizing the
resource for meeting goals
 Planning:
Determining org.’s goals &
the means for achieving them

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1.3 PLANING HISTORY
A. Military origin
 SP has its origin in warfare.
 The word strategy‘ is from Greek word
 strategos = stratos(army) and agein(conduct)
 The word tactic also derived from Greek
 Tactica = the art of disposing & maneuvering
forces in combat

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1.3 PLANING HISTORY CONT…
B. Adoption in the business world
 SP introduced in 1950s
 During the 1960s & 1970s it has been very famous
 SP periods in business divided into three periods:
 Product-orientation - 1820
 Market-orientation- 1900 and
 Post-industrial orientation – 1950

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1.3 PLANING HISTORY CONT…
C. Transfer to the public sector
 SP entered the public and semi-public sectors during
the mid-1980s
 D. Use in the education sector
 SP at the central education in 1990s
PESC MBA Program Organizational Planning Assignment By G1 Members

12. 1.4 Types Of Planning
1. Based on Organizational
level
A. Corporate planning
B. Divisional planning
C. Sectional planning
2. Based on Focus/scope or
breadth of activates
A. Strategic planning
B. Operational planning
C. Tactical planning 12
3. Based on Time period/
Duration /Time dimension
A. Long range planning
B. Medium range planning
C. Short range planning
4. Based on Dimension
/Frequency of Use
A. Single Use Plans
B. Standing plans

13. 1.4 Types Of Planning Cont.…
5. Based on the Nature of the
Plan
A.Informal planning
B. Formal planning
6. Based on Area of
Coverage / Objectives
A. Developmental planning
B. Economic planning
C. Administrative planning
D. Financial planning
E. Marketing plan 13
7. Based on the Specificity
of the Plan
A. Directional Planning
B. Specific Planning
8. Based on Contingent
Nature of the Plans
A. Crisis management plan
B. Scenario planning

14. 14
1.4 Types Of Planning Cont.…

15. 1.4 Types Of Planning Cont.…
Levels of Goals/Plans Managerial Planning Involvement
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16. 1.5 Why We Need Planning ???
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Merit Demerit
1. Reduces uncertainty
2. Ensures economical
operations
3. Facilitates control
4. Improves motivation
5. Gives competitive edge
6. Avoids duplication of efforts
1. Limitations of forecasts
2. Rigidity in administration
3. Time consuming process
4. Costly affair
5. Influence of external factors
6. Psychological factors

17. 1.5 Why We Need
Planning Cont. …. ???
17
A. Organization succeed
B. Efficient utilization of resource
C. Cooperative & coordination
effort
D. Direction and sense of purpose
E. Reduce uncertainty
F. Anticipated the future
G. Source of Motivation &
Commitment

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1.6 PLANNING PROCESS
PESC MBA Program Organizational Planning Assignment By G1 Members

19. 1.7 FUTURES OF GOOD PLANNING
 It is Based on Clearly
Defined Objectives
 It is Simple
 It is Flexible
 It is Comprehensive
 It is Time-Bound
 Unity and Continuous
 It is Balanced, Practicable
and Suitable According to
the Size and form of the
Business
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 It uses Available Resources to
the Utmost before Creating
New Authorities and New
Resources
 Participation by Subordinates
 Pervasive as all the levels of
management plan
 It Provides for a Proper
Analysis and Classification of
Action

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1.8 SKILLS REQUIRED FOR
PLANNING
 2 Basic skills are required for effective planning
1. Forecasting
2. Decision Making
1. Forecasting:
 It is the attempt to predict outcomes and future trends
 Internal & External factors affects forecasting process?

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1.8 SKILLS REQUIRED FOR
PLANNING Cont.….
 Forecasting techniques
1. Quantitative forecasting
 Applying a set of mathematical rules.
2. Qualitative forecasting
 Using expert judgments and opinions
3.Collaborative
 Planning, Forecasting, and Replenishment (CPFR) Software

22. 22
1.8 SKILLS REQUIRED FOR
PLANNING Cont.…
2. 1 Decision Making Definition
 “Making decisions is selecting one alternative from
different alternatives”
 It involves choice making

23. 1.8 SKILLS REQUIRED
FOR PLANNING Cont.…
2.2 Steps In Decision Making
1. Ascertain the need for a
decision
2. Establish decision criteria
3. Allocate weights to criteria
4. Develop Alternatives
5. Evaluate Alternatives
6. Select the Best Alternative
7. Putting Decision Into Action
8. Following up Decisions
Decision Making Process
23

24. 24
1.8 SKILLS REQUIRED FOR
PLANNING Cont.…
2.3 Types of in Decision Making
A. Programmed decisions:
 Decision for situation faced again and again
B. Non programmed Decisions:
 are used to solve nonrecurring problem.

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1.8 SKILLS REQUIRED FOR
PLANNING Cont.…
2.4 Decision making situations
A. Decisions under certainty
 Ready made information
B. Decisions under risk:
 Expected outcomes Probabilities assigned to each
alternative
C. Decisions under uncertainty:
 neither there is complete data nor probabilities

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1.9 DECISION-MAKING
CONDITIONS
PESC MBA Program Organizational Planning Assignment By G1 Members
Plan
Developed
By:
Advantages Disadvantages
Full Board
of
Directors
 Ownership by leadership
 Board becomes more
informed about programs
and activities
 Time availability may be
limited and scheduling
difficult
 May not achieve staff
ownership
Staff  Clear understanding of
operation
 Time flexibility
 Limited board involvement
and subsequent ownership
 May detract from other staff
responsibilities

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1.9 DECISION-MAKING
CONDITIONS Cont.…
PESC MBA Program Organizational Planning Assignment By G1 Members
Plan
Developed
By:
Advantages Disadvantages
Committee  Manageable size
 Can include a variety of
perspectives (such as board,
staff, partners, constituents,
etc.)
 Full board may not feel sense
of ownership of plan details
 Board perspectives may be
excluded
Consultant  Good understanding of
planning process
 Should produce timely and
professional-looking plan
 Limited board and staff
participation may lead to
limited sense of ownership
of plan details
 Limited board leadership
development

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1.10 SMART APPROACH
PESC MBA Program Organizational Planning Assignment By G1 Members
Acronym Description Developing SMART Goals
S Specific . A specific goal will usually answer the five "W" questions:
What: What do I want to accomplish?
Why: Specific reasons, purpose or benefits of accomplishing
the goal.
Who: Who is involved?
Where: Identify a location.
Which: Identify requirements and constraints.
M Measureable A measurable goal will usually answer questions such as:
• How much?
• How many?
• How will I know when it is accomplished?

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1.10 SMART APPROACH
CONT…
PESC MBA Program Organizational Planning Assignment By G1 Members
Acronym Description Developing SMART Goals
A Attainable An attainable goal will usually answer the question:
•How: How can the goal be accomplished?
R Relevant A relevant goal will usually answer the question:
Does this seem worthwhile?
T Time Bound A timely goal will usually answer the question:
When?
What can I do 6 months from now?
What can I do 6 weeks from now?
What can I do today?
R Reevaluate
Reward
 Reevaluate each goal to make sure they are still relevant
and attainable.
 Once goals have been accomplished, celebrate in their
accomplishment and start developing new SMART goals.

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1.11 SWOT ANALYSIS IN
PLANNING
PESC MBA Program Organizational Planning Assignment By G1 Members

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1.11 SWOT ANALYSIS IN
PLANNING CONT….
PESC MBA Program Organizational Planning Assignment By G1 Members
Acronym Description Basic Parameter
S Strength It Could be:
a)Technical expertise
b)Efficient human resources
c)Possession of latest physical assets
d)Strong research and development department
e)Joint venture with a Multi National Company
W WEAKNESS It is something that a company lacks.
a)Less competent staff
b)Lack of goodwill in the market
c)Obsolete plant and machinery
d)Underutilized plant capacity
e)Ineffective marketing strategies
f)Narrow product line

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1.11 SWOT ANALYSIS IN
PLANNING CONT….
PESC MBA Program Organizational Planning Assignment By G1 Members
Acronym Description Basic Parameter
O OPPORTUNITIES It Could be:
a)To enter in a new product line
b)To expand the company’s existing product lines
c)To enter into the foreign markets
d)To acquire the rival firms
e)To create new alliances to increase competitive strength.
f)To use latest technologies in the business.
T THREATS on any undertaking:
A)New competitors may enter the field
B) Customers purchasing substitute products
C) New technology making products obsolete
D)Slow down in the market leading to slump.
E) Change in government policies
F) Shift in buyers needs and tastes

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1.12 BARRIERS TO EFFECTIVE
STRATEGIC PLANNING Cont.…
S/N Barriers to
Strategy
Formulation
Barriers to Strategy
Implementation
How to Remove
Barriers?
1 Identical procedures Lack of accountability Clear Communications
2 Strict limitations Lack of commitment Manage the Change Process
3 People Inadequate instructions
to employees
Participation of employees
in planning process
4 Emphasized
ceremonial work
Power & Influence: Regular checks
5 Limited discussion Culture Accountability

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1.13 LIMITATIONS
TO EFFECTIVE PLANING
 Risky
 It ends up with difference
 Success and failure
 Uncertainties in the future
 Absence of accurate and adequate data
 Complicated task
 Requires patience
 Requires commitment

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1.13 LIMITATIONS
TO EFFECTIVE PLANING Cont.…
 Expensive and time consuming
 Financial
 Physical
 Human
 External factors
 External impositions
 Government intervention
 Important Export policy
 Taxation & labor law

36. 1.14 WHY PLANNING FAIL ???
1. Lack of top management’s
commitment
2. Staff control
3. Entrenched self-interests
4. Corporate culture.
5. Fear
6. Cynicism
7. Ignorance
8. Failing to periodically alter the
plan
9. Deviation from actual
objectives
10. Lack of confidence about
success
11. Lack of understanding of the role in
the execution process
12. Deviation from planned objective
13. Changes in responsibilities of
employees were not clear
14. People are not fully rewarded for
the execution of plans
15. Inadequate directions given by
departmental mangers
16. Information system used for
implementation is inadequate
17. Overall gals are not understood by
employees
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REFERENCE
1. Marx, T. G. (1991). "Removing the obstacles to effective strategic planning." Long
Range Planning24 (4): 21-28.
2. Butler, J. E., B. Brown, et al. (2000). "Guanxi and the dynamics of overseas Chinese
entrepreneurial behavior in Southeast Asia." Management and Organizations in the
Chinese Context, Macmillan, Basingstoke: 245-268.
3. Cascella, V. (2002). "Effective strategic planning." Quality progress35(11): 62-67.
4. Al-Ghamdi, S. M. (1998). "Obstacles to successful implementation of strategic
decisions: the British experience." European Business Review98(6): 322-327.
PESC MBA Program Organizational Planning Assignment By G1 Members

38. “If you don’t know where you are going, you’ll end up someplace else.”
Yogi Berra,

39. THE END!!!
THANK YOU!!!
39
QUESTION ???