Business Leadership 12: Unit 3 Planning and Controling

SMART Abbreviation Refers too..

1) Specific

2) Measurable

3)Attainable/Achievable

4) Realistic/Relevant

5) Timely

(S)MART

Specific: goal must be clear, well defined, detailed

S(M)ART

Measurable: define what signifies accomplishment of goals or progression towards goals, how is goal being tracked, milestones

SM(A)RT

Attainable: make sure goal is actually possible (time, ability, and resource wise)

SMA(R)T

Realistic: relevant to future plans, does it contribute to overall mission/visions

SMAR(T)

Timely: plans must have deadline, allows for sense of urgency

The Planning Process Steps

1) Define Objectives

2) Determine Where You Stand VS Objectives

3) Anticipate Future Events

4) Analyze and Chose Action Alternatives

5) Implement and Evaluate Results

Planning Process: Define Objectives

(Step 1) Identify desired outcomes, use SMART criteria

Planning Process: Determine Where You Stands VS Objectives

What strengths work in your favor, what weaknesses hold you back

**SWOT, BCG

Planning Process: Anticipate Future Events

Generate alternative scenarios, identify things that help or hinder progress towards objectives

Planning Process: Analyze and Chose Action Alternatives

evaluate possible actions, choose alternatives likely to accomplish objectives, select the best alternative given disadvantages vs advantages

Planning Process: Implement and Evaluate Results

measure progress towards objectives, do what the plan requires, evaluate results, take corrective actions and revise plans as needed

Benefits of Planning

1) Improved Flexibility

2) Improved Coordination and Control

3) Better Use of Time

Types of Plans

Short range, Long range, Operational, Single-use, Standing-Use

Short Range Plans

- less than a year

- exp: hire a new employee

Long Range Plans

- greater than 1 year

- exp: launch a new product

Operational Plans

Provide a clear understanding of how to complete day-to-day tasks

- ensure that individuals and teams are able to reach defined organizational objectives

Contingency Planning

the process of preparing alternative courses of action that may be used if the primary plans don't achieve the organization's objectives

Single Use Plans

- used only once

- created for unique situations

- exp: projects, budgets

Standing Use Plans

- designed to be used over and over again

- exp: policies, rules and procedures

Forecasting

Using current and past data to make informed decisions/predictions about the future

- Exp: how will products and services change in the future

Strategic Management Formula

Strategic Management (SM) = Strategic Formulation (SF) + Strategic Implementation (SI)

Strategic Management

Strategic management involves developing and implementing strategies to achieve an organization's long-term goals. 

Strategic Formulation

creating a strategy, assessing existing strategies, organization, and environment to develop new strategies

Strategic Formulation Involves

- setting goals and objectives,

- determining mission + vision,

- conducting SWOT, BCG,

- contingency plan,

- planning tools (Gantt, budget)

Strategic Implementation

process of allocating resources and putting strategies into action

Strategic Implementation involves...

- hiring training

- tracking progress

-controlling

- implementing policies + procedures

- reflect + review

- big portion: results --> reflect and improve

Competitive Advantage

- comes from operating successful ways that are difficult to imitate

- smth that sets you apart from competition

SWOT Analysis

A study undertaken by organization to identify its internal strengths and weaknesses, as well as external threat opportunities

Strengths (SWOT)

(Internal Positive Factors)

- what you do well

- internal resources

- advantages over competition

Weaknesses (SWOT)

(Internal Negative Factors)

- obstructions for competitive advantage

- areas of improvements, lacks

Opportunity (SWOT)

(External Positive Factors)

- opportunities in market or environment

- is perception of business positive

- ongoing or window for this opportunity

Threats (SWOT)

(External Negative Factors)

- existing, potential competitors

- risky factors beyond control

- unfavorable developments/trends

BCG Matrix

- analyzes businesses or products according to market growth rate and market share (on a four grid basis)

BCG Matrix Purpose

Helps companies decide what product to launch based on market, economy, + what products to get rid of

- also helps with resource allocation

Components of BCG Matrix

1) Question Mark

2)Star

3)Cash Cow

4) Dog

Question Mark (BCG)

"The Problem Child"

- High growth

- Low market share

--> a new product, introduction stage of product life cycle

- performance undetermined

Star (BCG)

- high growth and high market share

- high cash generation and consumption

- heavy investment

Cash Cow (BCG)

- Low growth and high market share

- foundation

- generate more cash than consumed, little investments + marketing needed

Dog (BCG)

- Low growth and low market share

- cash traps, high cost low output

- declining stage, costs business money

Product Life Cycle and BCG Matrix Location

1) Question mark = introduction phase

2) Star = Growth

3) Cow = maturity

4) Dog = decline

Steps in Control Process

1) Establish Performance Objectives and Standards

2) Measure Actual Performance

3) Compare Actual Performance with Objectives and Standards

4) Take Necessary Action

Control Process Step 1: Establish Performance Objectives and Standards

- Objectives: represent key desired results

- Standards and Measures: used to evaluate performance

Output Standard

measure performance results in terms of quantity, quality, cost of time

- results from effort

Input Standard

measures work efforts that go into a performance task

- effort put in

Control Process Step 2: Measure Actual Performance

- measure the performance efforts and results

- measurement must be accurate enough to differ between current and desired progress

- measure how much you over or underacheived

Control Process Step 3: Compare Results with Objectives and Standards

Compare objective with results

Control Process Step 4: Take Necessary Action

Focuses on differences between actual and desired performance

2 types of Exceptions: Problem Situations

performance is below expected levels

2 Types of Exceptions: Opportunity Situations

performance is above expected levels, learn what was done well --> can it be applied again

Discipline

act of influencing behavior through reprimand

Progressive Discipline

ties reprimands to the severity and frequency of the employee's infractions

Qualities of Progressive Discipline

1) Penalties very in accordance to severity and frequency of behavior

2) Use the least extreme disciplinary action possible

3) Follows a four step process, from least to most severe reprimands

Discipline must be _____ to be useful

handled in a fair, consistent, and systematic way

The Goal of Discipline

achieve compliance with organizational expectations through least extreme reprimands

A reprimand should be...

1) Immediate

2) Directed towards an action not personality

3) Consistently applied

4) Informative

5) In a supportive setting

6) Support realistic Rules

Why are control systems used

ensure things get accomplished, plans get followed, strategic direction continues, and organization objectives get met

Types of Controls

1) Feedforward

2) Concurrent

3) Feedback

Types of Controls: Feedforward

ensure directions and resources are right BEFORE the work begins

Types of Controls: Concurrent Controls

focuses on what happens DURING the work process

Types of Control: Feedback Controls

takes place AFTER an action is completed

Internal Control Strategy

occurs through self-discipline and self-control

Internal Control: Theory Y

Trust employees, believe they are motivated to do work, self-mediate, and self-correct/discipline

External Controls

occurs through direct supervision or administrative systems

External Control: Theory X

employees need direct supervision, managers do not trust employees

Gantt Chart

Visual representation of all the tasks in a project plotted against a timescale

Purpose of a Gantt Chart

Identify the minimum amount of time needed to complete a project

Advantage of Gantt Charts

- quick overview of large number of tasks and deadlines

- can help monitor progression against time

- delays can be calculated quickly

Disadvantage of Gantt Charts

- large-scale projects can end up hard to read

- each bar's length does not indicate complexity of tasks

Mission Statement

description of what an organization actually does/is

What to Consider When Creating a Mission Statement

- your customer base

- your products and services

- where you intend to operate

- who is this directed at (employee, customers, shareholders,)

Vision Statement

a company's road map, indicating both what the company wants to become and guides initiative towards growth

--> what you want to become