Planning and Decision-making (Chapter 2) - Principles of Management (Third Edition)

A set of Q&A flashcards covering planning, vision/mission, MBO, goals, planning techniques, decision-making, group decision-making, and contemporary issues as presented in the chapter notes.

What is planning in an organizational context?

A management function involving setting goals and deciding how best to achieve them; or the process of choosing a goal and developing a method or strategy to achieve that goal.

What is the difference between organizational vision and organizational mission?

A vision is a mental picture of the future you want to turn into reality; the mission is the organization’s purpose or fundamental reason for existence.

Name the four ways an organization can set its mission.

Targeting; common-enemy mission; role-model mission; internal-transformation mission.

What is Management by Objectives (MBO) based on?

Goals, participation, and feedback.

What are the three levels of organizational goals?

Strategic, tactical, and operational.

How should planning be aligned across organizational levels?

Planning at lower and middle levels should support top-level goals for coherence.

What are special-purpose plans used for?

Planning for change, contingencies, product development and speed.

What does planning for product development involve?

Cross-functional teams, internal and external communication, overlapping development phases, and frequent testing of product prototypes.

What is a key benefit of planning?

It can lead to greater effort and improved performance by managers and employees.

What is a potential drawback of planning?

It can create a false sense of certainty about the future; planning may detach planners from implementation.

What are organizational goals?

Key elements in planning; benefits include increased performance, clarified expectations, improved controlling, and increased motivation.

What are the three levels of goals that form a hierarchy?

Strategic, tactical, and operational goals.

How are goals and plans related?

Goals are the ends; plans are the means to achieve them; planning links goals and plans.

What are the four steps in benchmarking?

Form a benchmarking team; gather internal and external information; analyze data to identify performance gaps; prepare and implement action plans.

What is budgeting in planning?

Numerical plans for allocating resources to specific activities; scheduling identifies the sequence and responsibility; examples include Gantt charts and PERT network analysis.

What is a balanced scorecard?

A performance metric used to clarify strategy, monitor progress, and define/manage action plans; provides a map of where to go and how to get there.

What are KPIs?

Key performance indicators that measure how well units or individuals perform against goals; break goals into smaller indicators to aid decision-making.

What is scenario planning?

Planning that allows managers to explore and prepare for several alternative futures.

What is contingency planning?

Planning that measures the potential impact of abrupt market changes and prepares strategies to deal with disruptions.

How many steps are in the MBO process?

Six steps.

What is the decision-making process?

Identifying and diagnosing the problem; generating alternatives; evaluating alternatives; making the choice; implementing the decision; evaluating the decision. The process can be iterative.

What is group decision-making?

A process where people are brought together to solve problems by sharing opinions; methods include authoritarian style, brainstorming, and voting.

What are advantages of group decision-making?

Combines individual strengths; enhances understanding; increases commitment; fosters team spirit.

What are disadvantages of group decision-making?

Takes more time; more opinions to consider; minority views may be ignored; accountability may be uneven; can reduce efficiency.

What factors affect the organizational decision-making process?

Involvement of multiple divisions and organization-wide support; alignment of key areas.

Name some contemporary planning and decision-making issues.

Legal issues, technological issues, financial support, effective marketing strategies, innovation, creativity, and intellectual capital.