BMGT 1 | Foundations of Planning

PLANNING

involves defining the organization's goals, establishing an overall strategy, and developing a comprehensive set of plans to integrate and coordinate organizational work

INFORMAL PLANNING

nothing is written down

• little or no sharing of goals
• general and lacking in continuity

FORMAL PLANNING

written

• defines specific goals
• specific action programs exist to achieve goals

GOALS

desired outcomes

• provide direction for all management decisions
• represent the criteria against which actual work accomplishments can be measured

PLANS

outline how goals are going to be met

FINANCIAL GOALS

relate to financial performance

STRATEGIC GOALS

relate to other areas of performance

STATED GOALS

official statements of the organization’s goals

REAL GOALS

those goals that an organization actually pursues

STRATEGIC PLANS

apply to the entire organization

–establish organization’s overall goals
–seek to position the organization in terms of Its environment

OPERATIONAL PLANS

specify the details of how the overall goals are to be achieved

–tend to cover short time periods

LONG-TERM PLANS

time frame beyond three years

– definition of long term has changed with increasingly uncertain organizational environments

SHORT-TERM PLANS

cover one year or less

SPECIFIC PLANS

clearly defined with little room for interpretation

– required clarity and predictability often do not exist

DIRECTIONAL PLANS

flexible plans that set out general guidelines

– provide focus without limiting courses of action

SINGLE-USE PLANS

one-time plans specifically designed to meet the needs of a unique situation

STANDING PLANS

ongoing plans that provide guidance for activities performed repeatedly

–include policies, procedures, and rules

TRADITIONAL GOAL SETTING

overall goals established at the top of the organization

TRADITIONAL GOAL SETTING

overall goals broken down into subgoals for each level of the organization

HIGHER-LEVEL GOALS

must be made more specific at lower levels

NETWORK OF GOALS

creates a MEAN-ENDS chain

SUB-GOALS

constrain subordinates’ behavior

TOP MANAGEMENT'S OBJECTIVE

“We need to improve the company’s performance”

DIVISION MANAGER'S OBJECTIVE

“I want to see asignificant improvement in this division’s profits”

DEPARTMENT MANAGER'S OBJECTIVE

“Increase profits, regardless of the means”

INDIVIDUAL EMPLOYEE'S OBJECTIVE

“Don’t worry about quality: just work fast”

MANAGEMENT BY OBJECTIVES (MBO)

specific performance goals are jointly determined by employees and their managers

MANAGEMENT BY OBJECTIVES (MBO)

progress toward accomplishing these goals is periodically reviewed

MANAGEMENT BY OBJECTIVES (MBO)

rewards are allocated on the basis of this progress