2. Goals and Plans
A blueprint specifying the resource allocation, schedules,
and other actions necessary for attaining goals.
Planning is considered the most fundamental function.
Planning is the most controversial management function.
Plan
Goal
A desired future state that the organization attempts to
realize.
4. Goals and Plans Purposes
Legitimacy/Mission Statement
Describes values, aspirations, and reason for being.
Focuses on, customers, corporate values, product quality, and attitude toward employees.
Source of Motivation and Commitment
Facilitate employees’ identification with the organization.
Guides to Action
Provide a sense of direction.
Focus attention on specific targets.
Direct efforts toward important outcomes.
What the organization stands for.
Standard of Performance
Serve as performance criteria.
Provide a standard of assessment.
5. Peter Drucker’s Eight Content Areas in
Developing Goals
Marketing.
Innovation.
Productivity.
Physical and financial resources.
Profitability.
Managerial performance and development.
Worker performance and attitude.
Public responsibility.
7. Goals and Plans
Strategic Goals
• Where the organization wants to be in the future.
• Pertain to the organization as a whole.
Strategic Plans
• Action Steps.
• Blueprint that defines the organizational activities
and resource allocations.
8. Tactical Goals and Plans
Tactical Goals
Goals that define the outcomes that major divisions
and departments must achieve.
Tactical Plans
Plans designed to help execute major strategic plans.
9. Operational Goals and Plans
Operational Goals
Specific, measurable results expected from
departments, work groups, and individuals.
Operational Plans
Organization’s lower levels that specify action
steps toward achieving operational goals.
11. Means End-Chain
• The achievement of goals at low levels
permits the attainment of high-level goals.
12. Characteristics of
Effective Goal Setting
Goal Characteristics
Specific and measurable.
Cover key result areas.
Challenging but realistic.
Defined time period.
Linked to rewards.
13. Model of the MBO Process
Step 1: Setting Goals Step 2: Developing Action Plans
Step 3:
Reviewing Progress
Corporate Strategic Goals
Departmental
Goals
Individual Goals
Step 4: Appraising Overall
Performance
Appraisal of Overall Performance
Corrective Action
Review Progress
Action Plans
14. MBO Benefits and Problems
Benefits of MBO Problems with MBO
1. Manager and employee efforts are
focused on activities that will lead to
goal attainment.
2. Performance can be improved at all
company levels.
3. Employees are motivated.
4. Departmental and individual goals
are aligned with company goals.
1. Constant change prevents MBO from
taking hold.
2. An environment of poor employer-
employee relations reduces MBO
effectiveness.
3. Strategic goals may be displaced by
operational goals.
4. Mechanistic organizations and values that
discourage participation can harm the
MBO process.
5. Too much paperwork saps MBO energy.
16. How Do Managers Plan?
• Establishing Goals
– Approaches to Establishing Goals
• Traditional goal setting - Overall goals established
at the top of the organization
– overall goals broken down into sub goals for each level
of the organization
Problems of traditional goal setting
1. Planners out of touch on day to day basis
2. No flexibility in plans
3. Less creativity and learning
18. The New Planning Paradigm
Six Rules of
Planning
Start with
a Strong
Mission
Set Stretch
Goals
Create an
Environment
that
Encourages
Learning
Design
New Roles
for
Planning
Staff
Use
Temporary
Task Forces
Planning
Still Starts
and Stops
at the Top
19. Strategic Management Questions
What changing and trends are occurring?
Who are the customers?
What products or services should we
offer?
How can we offer these products or
services efficiently?