MANAGEMENT FUNDAMENTALS Lesson 3 Strategic and Operational - - PowerPoint PPT Presentation

MANAGEMENT FUNDAMENTALS

Lesson 3

Chapter 07

Strategic and Operational Planning

Plan is the blue print which drives a company confidently towards the unforeseen future…

What is Planning?

Planning is the process of setting organisation’s goals and deciding how best to achieve them

1 – goal setting 2 – defining strategy, tactics and action plans to achieve the set goals

SHORT TERM PLANNING vs. LONG TERM PLANNING

Short term plans are becoming more favourable and realistic

Levels of Plans/Goals

Mission statements outline the stated purpose and values, aspirations and reason for being in business

What is the purpose behind we carrying out

• ur business?

Mission “Enable people and businesses throughout the world to realize their full potential”

Mission of TOYOTA Mission of Toyota is to provide safe & sound journey

Levels of Goals/Plans and their Importance

Strategic Plans: Prepared for the entire

• rganization (defines the holistic approach
• f the company)

Tactical Plans : Prepared for major divisions and departments

ABC Company Electronics Business Pharmaceuticals Marketing Administration HR Finance FMCG

Division

Levels of Goals/Plans and their Importance

Operational Plans: Results expected from departments, work groups and individuals

(defines detail action plans) Whole Organization Department Individuals/units

Benefits of Goals and Plans



Legitimacy



Source of motivation and commitment



Resource allocation



Guides to action



Rationale for decisions



Standards of performance

PLANNING APPROACHES

• Usa

sage ge based sed approa

• ach:

ch:

– Single use plans – Standing plans

• Objecti

ective e based ed approa

• ach

ch: Management by Objectives (MBO)

• Situa

uati tion

• n based

sed approa

• ach

ch: Contingency plans

8/18/2018 GDM M 401 PB: HDM

Single and Standing Plans

Plans (Based on the frequency

• f usage)

Single use plans Plans used or referred only

• nce

Standing plans Plans referred and used repeatedly

Usage

Single Use Plans

 These plans are developed to achieve a set of goals that are not

likely to be repeated in the future (for one-time achievements/activities)

 These plans normally prepared for Programmes and Projects

 A programme is a complex set of objectives and plans to achieve

an important, one-time organisational goal (e.g. A plan prepared to carryout a program to enhance disciplinary behavior of employees)

 A project is similar to a programme, but generally smaller in

scope and complexity (A plan prepared to initiate a CSR project in A’pura)

Standing Plans

 Standing Plans are on-going plans/documents that provide

guidance to tasks which are generally performed and referred repeatedly within an organization

 These plans include Policies, Rules and Procedures:

 Policies  Accepted/Agreed guidance – e.g. How to select a

supplier? Supplier selection policy

 Rules  Accepted norms – e.g. How should employees behave?

Code of ethics

 Procedures  Agreed methods or steps to follow – e.g.

Procedure to handle employee grievances

Management by Objectives – MBO Method

In this method, managers and subordinates sit together and define goals and objectives to be achieved within a given period of time for which the subordinate is directly held responsible

Peter Drucker

Practice of Management, 1954

Dialogue

Manager Subordinate Manager Subordinate

Non-MBO

MBO

Goals / Plans Goals / Plans

MBO is a system whereby managers and employees define goals for every department, project, and person and use them to monitor subsequent performance.

Model of the MBO Process

Contingency Plans

 Contingency plan - plan that determines the alternative

course of action to be taken if an intended plan is unexpectedly disrupted or rendered inappropriate

 Plans for emergencies, setbacks or

unexpected conditions

 These plan would reduce the possible lost to personnel

and properties

Disney’s Cruise Line



Once Walt Disney announced plans to launch a cruise line with familiar Disney characters and themes, managers also began aggressively developing and marketing packages.



The inaugural sailing was sold out more than a year in advance, and the first year was booked solid six months even before the ship was launched.



Three months before the first sailing, however, the shipyard constructing Disney’s first ship notified that it was behind schedule and that delivery would be several weeks late.



Since Disney had no other ships they had no

• ther options but to refund money to the

passengers who booked the first 15 cruises.



Big discounts were proposed to those passengers who would rebook on a later

• cruise. Many of them, however, could not

rearrange their schedules and requested full

• refunds. Some were blaming managers at

Disney for poor planning

Past Paper Question - Jan 2010

 Organizations vision and mission statements

determines the direction of the organization. Briefly define the concept of organization mission and examine how it influences the goal setting and planning in organization

 20 marks

The End