MGT401 Short Notes

Types of Planning?

Informal Planning

1. Nothing is written down
2. Little or no sharing of goals
3. General and lacking in continuity

Formal Planning

1. Written and defined specific goals
2. Specific action programs exist to achieve goals Approaches to Planning

Inclusive Approach Employees at each level develop plans suited to their needs Employees acquire greater sense of the importance of planning when they participate in the process

The planning process ‘Setting goals and developing plans that leads to goal attainment and ultimately, to organisational efficiency and effectiveness.’ How Do Managers Plan? Steps in Goal Setting 1 - Review the organization’s mission 2 - Evaluate available resources 3 - Determine the goals individually or with input from others

4. Should be congruent with the organizational mission and goals in other organizational areas 5- Write down the goals and communicate them to all who need to know them 6- Review results and whether goals are being met The planning process

Mission The organisation’s purpose or fundamental reason for existence. Goal Future target or end result an organisation wishes to achieve. Plan Means devised for attempting to reach a goal. Organisational Mission Mission statement may: Be unwritten. Address customers, products/services, location, technology, concern for survival, concern for public image, concern for employees. Organisational Goals Benefits of Goals Increases Performance Clarifies Expectations Facilitates Control Increases Motivation Levels of goals Top Managers Organisational Perspective Middle Managers Departmental Perspective 1st level Managers Unit/individual Perspective Goals and Performance Key Aspects:

1. Goal Content
2. Goal Commitment
3. Work Behaviour
4. Other Process Components
5. Possible Problems Goal Content

Content should be: Challenging Specific Measurable Attainable Relevant Time limited Goal Commitment Influenced by: Supervisory Authority Peer & Group Pressure Public Display Expectations of Success Incentives & Rewards Participation Goals & Work Behaviour Goals & Commitment affect Work Behaviour: Direction Effort Persistence Planning Goals & other Process Components Job process components affect performance: Job Knowledge & Ability Task Complexity Situational Constraints Goals & Possible Problems Possible Problems with Goals: Excessive risk taking Increased stress Undermined self-confidence Ignored non-goal area Excessive short-run thinking Dishonesty & cheating

Levels of Goals and Plans: Operational Tactical Strategic Linking Goals & Plans Time span of Goals and Plans: Short (Operational) Intermediate (Tactical) Long range (Strategic) How to Make a Plan That Works Developing Effective Action Plans Starting at the Top A Corporation’s Mission Bending in the Middle Finishing at the Bottom Linking Goals & Plans Recurring use: Single use Standing PlansPolicies, Procedures, Rules Kinds of Operational Plans Special-Purpose Plans Management by Objectives (MBO) ‘Process through which specific goals are set collaboratively for the organisation as a whole and every unit within it; The goals are then used as a basis for planning, managing organisational activities, and assessing and rewarding contributions.’ Steps in the MBO process:

1. Develop organisational goals
2. Establish specific goals for departments
3. Formulate action plans
4. Implement & maintain ‘self-control’
5. Review progress periodically
6. Appraise performance

Strengths:

1. Helps link goals & plans
2. Clarifies priorities, and

expectations

3. Fosters organisational

communication

4. Builds member motivation

Weaknesses:

1. Needs strong, enduring commitment
2. Requires training of managers
3. May be misused (i.e. for punishment)
4. Risk of dominance of quantitative goals