Planning is a primary managerial function that focuses on setting objectives and goals, establishing strategies to achieve those goals, and developing action plans. Good planning provides direction, reduces uncertainty, and improves organizational performance. Higher quality planning leads to better financial results and performance. Planning involves setting goals and objectives at different levels of the organization from strategic to tactical. Strategic management is the process of formulating, implementing, and evaluating business strategies to achieve organizational goals and integrate different departments. A key part of strategic management is analyzing the organization's strengths, weaknesses, opportunities, and threats through tools like SWOT and understanding the competitive forces in the industry.
Planning is a primary managerial function that focuses on setting objectives and goals, establishing strategies to achieve those goals, and developing action plans. Good planning provides direction, reduces uncertainty, and improves organizational performance. Higher quality planning leads to better financial results and performance. Planning involves setting goals and objectives at different levels of the organization from strategic to tactical. Strategic management is the process of formulating, implementing, and evaluating business strategies to achieve organizational goals and integrate different departments. A key part of strategic management is analyzing the organization's strengths, weaknesses, opportunities, and threats through tools like SWOT and understanding the competitive forces in the industry.
Planning is a primary managerial function that focuses on setting objectives and goals, establishing strategies to achieve those goals, and developing action plans. Good planning provides direction, reduces uncertainty, and improves organizational performance. Higher quality planning leads to better financial results and performance. Planning involves setting goals and objectives at different levels of the organization from strategic to tactical. Strategic management is the process of formulating, implementing, and evaluating business strategies to achieve organizational goals and integrate different departments. A key part of strategic management is analyzing the organization's strengths, weaknesses, opportunities, and threats through tools like SWOT and understanding the competitive forces in the industry.
Planning is a primary managerial function that focuses on setting objectives and goals, establishing strategies to achieve those goals, and developing action plans. Good planning provides direction, reduces uncertainty, and improves organizational performance. Higher quality planning leads to better financial results and performance. Planning involves setting goals and objectives at different levels of the organization from strategic to tactical. Strategic management is the process of formulating, implementing, and evaluating business strategies to achieve organizational goals and integrate different departments. A key part of strategic management is analyzing the organization's strengths, weaknesses, opportunities, and threats through tools like SWOT and understanding the competitive forces in the industry.
Download as DOCX, PDF, TXT or read online from Scribd
Download as docx, pdf, or txt
You are on page 1/ 4
UNIT 2
PLANNING
What is Planning & its Focus
-Planning - a primary managerial function focusing. – Defining & setting the organization’s objectives or goals – Establishing an overall strategy for achieving those goals – Developing documented plans for organizational work activities (actionable) -So, its Elements are: – Goals/Objectives – Strategies – Plans for Action Why Do Managers Formally Plan? • Reasons for Planning – Provides direction – Reduces uncertainty – Minimizes waste and redundancy – Sets the standards for controlling/monitoring Over all, it improves Organizational Performance Planning & Performance • The more the quality of planning & its implementation, the more would be the performance in terms of • Higher profits and returns on investment (ROI) & assets • Positive financial results • Reduces the impact of environment on Organization thru planning & thereby the performance Dimensions of Plans
Strategic (the entire line) is for Top/Sr Management level & Tactical (the entire line) for lower-level managers
Planning in the Hierarchy/Levels of Organizations
“Planning is looking ahead and Controlling is looking behind”
Types of Goals? • Financial Goals - related to the financial performance of the organization. • Strategic Goals - related to all other areas of an organization’s performance.
Characteristics of MBO • A process of setting mutually agreed –upon goals • Using those goals to evaluate employee performance as well as group performance • Progress towards accomplishing goals is periodically reviewed.
Key elements of MBO:
– Goal specificity (SMART) or objectivity – Participative setting process – Explicit performance/evaluation period – Periodic Feedback
Steps in a Typical MBO Program Hierarchy of objectives
Writing Effective Objectives
Max E. Douglas’s model for writing effective objectives: – (1) the word to, followed by – (2) an action verb, – (3) a statement of the single, specific, and measurable result to be achieved, and – (4) a target dates. To achieve a 6% overall return on fourth quarter sales. FROM (I) GOALS/OBJECTIVES TO (II) STRATEGIES & STRATEGIC MANAGEMENT
What is Strategic Management?
• Strategic management is the art of formulating business strategies, implementing them, and evaluating their impact based on Organizational Goals/Objectives • The concept focuses on integrating various departments (Like Finance and Accounting, Research and Development, Production, Marketing, info systems etc.) to achieve Organizational Goals/Objectives. The Term strategic planning is synonymous with strategic management, only that the former is used in the corporate world and the latter in the academic setting.
PLANNING PREMISES • Planning premises are defined as the anticipated environment in which plans are expected to operate. They include assumptions or forecasts of the future and known conditions that will affect the operation of plans. What is the Strategic Management Process? • Strategic management process - a six-step process that encompasses strategic planning, implementation and its evaluation.
VISION “It is essentially a dream.” “A perception of the kind of environment an organization, aspires to create within a broad time horizon and the underlying conditions for the actualization of this perception” MISSION The mission statement of an organization is normally short, to the point, and contains the following elements: • Provides a concise statement of why the organization exists, and what it is to achieve; • States the purpose and identity of the organization; • Defines the institution's values and philosophy; and • Describes how the organization will serve those affected by its work. SWOT • Strengths - any activities the organization does well or any unique resources that it has. • Weaknesses - activities the organization does not execute well or needed resources it does not possess. • Opportunities-Positive trends in the external environment. • Threats- Negative trends in the external environment.
Types of Organizational Strategies
Managers typically formulate 3 main types of strategies: – Corporate – Competitive/Business – Functional
Top-level managers typically are responsible for
corporate strategies, middle-level managers for competitive strategies, and lower-level managers for functional strategies. Planning in Dynamic Environments • Develop plans that are specific but flexible. • Understand that planning is an ongoing process. • Change plans when conditions warrant alterations. • Persistence in planning eventually pays off. • Flatten the organizational hierarchy to foster the development of planning skills at all organizational levels. Contingency Factors in Planning 3 Major Factors Contingency Factors in Planning • Manager’s level in the organization – Strategic plans at higher levels – Tactical/Operational plans at lower levels • Degree of environmental uncertainty – Stable environment: specific plans • Length of future commitments – Commitment Concept: Current plans affecting future commitments, must be sufficiently long-term in order to meet those commitments. Industry & Competitive Situation Analysis • Situation Analysis – Focuses on those features in a company’s environment that most directly affect its options and opportunities.
Five Competitive Forces - Michael Porter
Five Forces Model • Rivalry among current competitors – Intensity among rivals increases when industry growth rates slow, demand falls and product prices descend • Threat of New Entrants – The ease or difficulty with which new competitors can enter an industry • Bargaining Power of Buyers – The degree to which buyers have the market strength to hold sway over and influence competitors in an industry • Threat of Substitutes – The extent to which customers adopting substitute products and services • Bargaining Power of Suppliers – The relative number of buyers to suppliers and threats from substitutes and new entrants affect the buyer- supplier relationship.
