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Elements of Planning

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Organizational Goals

Guidance and unified direction

Promotion of good planning

Source of motivation

Evaluation and control

Purposes of Goals

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Kinds of Goals

By LevelMission statement

Strategic goalsTactical goals

Operational goals

By AreaOperationsMarketingFinance

Production

Time FrameLong-term goals

Intermediate goalsShort-term goals

Explicit goalsOpen-ended goals

Setting Organizational Goals

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Kinds of Organizational

Goals for a Regional Fast-

Food Chain

Creating S.M.A.R.T. Goals

   Specific – Be clear about what you want to accomplish.

Measurable – Put in quantifiable terms to track your progress.

Attainable – Make it challenging, but attainable.

Realistic – Be willing and able to work toward.

Timely – Include a time frame, have due dates for milestones.

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• Strategic Plans(Top Management)– Broadest set of plans – primary objectives– Mission statement

• Tactical Plans (Middle Management)– Smaller scale – used to implement a strategy– Typically 1-3 year period

• Operational Plans (Supervisory Management)– Designed to implement tactical plans– Typically 1 year or less– Deals with the “how” in accomplishing specific

objectives

• Contingency Plans (Any management level)– Alternative courses of action

Kinds of Organizational Plans

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• The Time Dimension of Planning– Planning must provide sufficient time to fulfill the managerial

commitments involved.

Long-range (strategic) plans of 5 or more years

Short-range (operational) action and contingency plans of 1 year or less

Intermediate-range (tactical) plans of 1–5 years

1 5 10

7–8

Plan Type Description

Single-use plans Developed to carry out a course of action not likely to be repeated in the future

Program Single-use plan for a large set of activities

Project Single-use plan of less scope and complexity than a program

Standing plans Developed for activities that recur regularly over a period of time

Policy Standing plan specifying the organization’s general response to a designated problem or situation

Standard operating procedure

Standing plan outlining steps to be followed in particular circumstances

Rules and regulations Standing plans describing exactly how specific activities are to be carried out

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Rule: (no exceptions)

No returns over $50 without a managers signature

Policy: (manager has some discretion)

Accept customer returns

Procedure:Outline steps to be followed in particular circumstances

(SOPs- Standard Operating Procedures)

Example of Policy, Rule, and Procedure

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Major barriers Inappropriate goals

Improper reward system

Dynamic and complex environment

Reluctance to establish goals

Resistance to change

Constraints

Overcoming the barriers

Understanding the purposes of goals and planning

Communication and participation

Consistency, revision, and updating

Effective reward system

Barriers to Goal Setting and Planning

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The Formal Goal-setting Process

Management By Objectives (MBO)

•Goals are collaboratively set between managers and subordinates

•Evaluation and reward based on subordinate’s performance