CHAPTER TWO

PLANNING

INTRODUCTION
Planning means looking ahead and chalking out future courses of action to be followed. It is a preparatory step. It is a systematic activity which determines when, how and who is going to perform a specific job. Planning is a detailed program regarding future courses of action. Therefore, planning takes into consideration the available & prospective human and physical resources of the organization so as to get effective co-ordination, contribution & perfect coadjustment. It is the basic management function which includes formulation of one or more detailed plans to achieve optimum balance of needs or demands with the available resources.

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INTRODUCTION

Planning is the 1st process in management. The planning process enables other management functions such as organizing, controlling, leading and decision making to be performed in the organization. It is a comprehensive set of plans used to integrate and coordinate organizational work.

DEFINE PLANNING
Planning is,
o a process of setting or establishing goals and thereafter determining ways to achieve these goals. o the process of analyzing relevant current or past information, with the purpose of measuring and forecasting the future in order to achieve organizational goal. goal. o A process whereby managers form the organizational goals and decide the most suitable action to achieve the goals.

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DEFINE PLANNING

Definition by management GURUS

o CERTO (1997) Planning is a process of determining how the management system can move the organization towards achieving it goals. o STONER, FREEMAN and GILBERT (1995) Planning is a process of forming goals and taking suitable actions to achieve these goals. It involves activities such as determining the goals to be achieved by the organization and the suitable application methods.

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DEFINE PLANNING

o DESSLER (2001) Planning is a basic process of selecting and determining suitable actions to achieve goals. It is a comprehensive preset methods before performing a certain actions. o MICHEAL SCOTT Planning is an analytical process that involves the evaluation of future situations. It involves the development and the selection of the best alternatives to achieve goals. The purpose of training is to provide information regarding certain actions in order to identify a successful management process.

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DEFINE PLANNING

In conclusion,

Planning is a process of managing all the individuals involved in the organization and variables from the internal and external environment of the organization in order to achieve the set goals.

OBJECTIVES OF PLANNING
Can be view from the importance of goals:

o Provide a direction o Focus on effort o Drive organizational planning and decision making o Evaluate the organizations achievements

THE IMPORTANCE OF PLANNING

Planning in an organization is conducted for several reasons:
o o o o o o o o o o Identify business or investment opportunities Identify suitable alternatives actions Reduce risks Save costs Facilitate the achievement of goals Provide guidance Provide direction Facilitate coordination Understand the environment Ensure organizations do not stray from original goals

CREATIVITY
The conversion to a new generation of ideas and innovation of products, services or production method. Example of a new product is the I-Pad phone, INokia 3G mobile phone, etc. Example of new services are express courier services, online marketing by major airlines, online banking, etc.

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CREATIVITY

LAWRENCE B MOHR, creativity involves the MOHR, introduction of something new to human, while innovations involves the introduction of new applications. JOSEPH SCHUMPETER, innovation as a successful SCHUMPETER, resource in an economy. Creative individuals have unique abilities such as flexibility, give important to originality, prefer complexity and are individualistic in attitude. Gates, For example, Bill Gates, the founder of Microsoft Windows software is said to be a creative individual.

THE PROCESS OF CREATIVITY

The process of creativity involves the following three steps:

Generating ideas or opinion

Expanding the ideas or opinions

Implementing the ideas or opinion

METHOD TO ENCOURAGE CREATIVITY

1

Brainstorming

METHOD TO ENCOURAGE CREATIVITY

Cont

Before

Nominal Group Process

METHOD TO ENCOURAGE CREATIVITY

Cont

3 Discussion

Synectics
(Gordons Technique)
Identify the problems

METHOD TO ENCOURAGE CREATIVITY

Cont

The group fails to find solution,

Creative Group Decision Making

It spontaneous and involves all employees in the process. Ideas come from people.

TYPES OF PLANNING
STRATEGIC PLANNING

TACTICAL PLANNING

OPERATIONAL PLANNING

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TYPES OF PLANNING
The Hierarchy of Planning
Mission Strategic Planning Goals Overall Objectives Area objectives Division Objectives Department Objectives Individual Objectives Operational Planning Tactical Planning

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TYPES OF PLANNING

Strategic Planning (Long Term Planning)

 Setting long term goals and objectives for an organization and selecting suitable actions to allocate organizational resources in order to achieve these goals.  Conducted for a period more than five years.  Perform by top-line managers or strategic managers. top Directly influences tactical planning and operational planning.  Steps?  How?

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TYPES OF PLANNING

Tactical Planning (Mid Term Planning)

 Involves a shorter period of time to achieve goals set at the strategic level.  Conducted for a period of between one and five years.  Performed by middle-line managers or tactical middlemanagers .  Clearly states the roles and contributions of each department or unit in achieving the strategic plan developed by top-line managers. top Characteristic ?

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TYPES OF PLANNING

Operational Planning (Short Term Planning)

 Concentrates on the development of specific targets or goals.  Involves a small or specific scope such as job units or individuals .  Performed for a time duration of one year or less.  Developed and determined by first-line managers or firstoperational managers, based on the objectives of tactical planning.  Provide specific guidance on the roles and responsibilities of the relevant parties in the organization in achieving operational , based on the implementation of the strategic and tactical planning.

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TYPES OF PLANNING

ContOperational Planning (Short Term Planning)

Operational Planning

Single-use Plan

Standing Plan

Program

Project

Budget

Policy

Procedure

Rule

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TYPES OF PLANNING

ContOperational Planning (Short Term Planning) Single-use Plan Singleo Designed to achieve specific goals, for the situation that would not repeated. Once the goals achieved, the plan will be dissolved. o Concentrates on the implementation of activities to overcome complex problem that require specific attention. o Implemented once, would not be repeated in the same form in the future. o Implemented in a short duration of time. o Managers have limited time to find solution to the problem and achieve the set goals.

Cont

TYPES OF PLANNING

ContOperational Planning (Short Term Planning) ContSingle Use Plan

Programme
o An intermediate planning which involves a set of bigger activities. o Plans for attaining a one-time organizational goals. oneo Major undertaking that take several years to complete o Large in scope; maybe associated with several projects o Examples, building a new headquarters, converting all paper files to digital o Steps to prepare a program:
1. Determine steps to be taken 2. Determine the individuals or units responsible for each steps 3. Determine the implementation period for each step.

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TYPES OF PLANNING

ContOperational Planning (Short Term Planning) ContSingle Use Plan

Project
o Smaller in scope, often one part of a larger program. o Contain distinct directives concerning assignments, determination of task and time frame. o Examples, renovating the office, setting up a company intranet.

Cont

TYPES OF PLANNING

ContOperational Planning (Short Term Planning) ContSingle Use Plan

Budget
o Statements of financial resources set aside for specific activities in a given period of time. o Primarily devices to control an organizations activities to ensure that the money used to perform an activity < the total amount allocated for the activity. o It comprises income and expenditure items that will be utilized in the programs or projects. o Planned activities must be implemented in a short time period (3 month, 6 month or 1 year). o Activities listed in the annual budget will be different from 1 year to another.

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TYPES OF PLANNING

ContOperational Planning (Short Term Planning) Standing Plan

o A pre-established single decision or set of decisions that preeffectively guide the organizational activities occur repeatedly. o Helps managers conserve time because similar situations are handled in a predetermined and consistent manners. o Important to the lower-line managers because it is used daily loweras a guide in decision making.

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TYPES OF PLANNING

ContOperational Planning (Short Term Planning) ContStanding Plan

Policy
o A general guideline used by managers to take actions and make decisions. o Set up boundaries around decision, telling managers which decision can be made and which cannot. o It channels the thinking of organization members so that it is consistent with organizational objectives. o In certain situation, managers can use their judgment in making decision. o Design by top-line managers in written and lower-line toplowermanagers specifically determine how it will be implemented.

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TYPES OF PLANNING

ContOperational Planning (Short Term Planning) ContStanding Plan

Procedure
o Detailed set of comprehensive instructions for performing a sequence of actions that occurs often, repeatedly or regularly. o Provide a detailed guideline to implement established policies. o Also called standard operating procedure or standard methods. o Example, procedure for applying loan, customers must fill up a specific form and wait for the banks approval of the application.

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TYPES OF PLANNING

ContOperational Planning (Short Term Planning) ContStanding Plan

Rule
o Statements of specific actions to be taken in given situation. o If the rule is broken , it is usually accompanied with actions and penalties. o Examples, customers must pay installments on a specified date. Fine will be imposed if these rules are not followed.

PLANNING PROCESS
There are five basic stages in the planning process:
STEP 1

Setting goals Defining the current situation Identifying assistance and resistance Developing new set of plans and actions Re-evaluating goals

STEP 2

STEP 3

STEP 4

STEP 5

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PLANNING PROCESS
Setting goals

STEP 1

Goals must be clear, realistic, rational, logical and have specific time frame. Managers must identify what is desired or needed by organization and a target performance that has to be achieved by organization.

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PLANNING PROCESS
Defining the current situation

STEP 2

Managers at all levels will examine the current condition of organization and compare it with the goals that are to be achieve. To ensure the financial resources, human resources and organizations information are adequate to achieve the set goals.

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PLANNING PROCESS
Identifying assistance and resistance

STEP 3

Examine internal and external organizational factors that can assist or hinder the process of achieving organizational goals. management must find suitable alternatives, identify available support and existing barriers, and determine the solution that should be taken.

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PLANNING PROCESS
Developing a new set of plan and actions

STEP 4

Managers will identify various alternative actions, evaluate each alternative and select the best alternative that can be implemented to achieve the set goals. Managers also need to find supporting alternatives to help quicken the achievement of organizational goals.

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PLANNING PROCESS
Re-evaluating goals

STEP 5

If the planning is not implemented successfully, managers must set new goals or design new plans. This stages involves the process of re-evaluating all rethe steps implemented in the planning process and identifying the steps that had caused the planning to fail. Information obtained from the re-evaluation process recan be used as an indicator to develop new plan in the future.

PROBLEMS FACED IN PREPARING PLAN

Managers face self-conflict in establishing goals self-

WHY?
    

Refusal to give up old goals or alternative goals Anxiety toward failure Lack of knowledge about the organization Lack of knowledge about the environment Lack of self-confidence self-

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PROBLEMS FACED IN PREPARING PLAN

Employees refuse to accept changes in plan

WHY?
  

Employees are in doubt over the impact of changes Employees refuse to forego existing goals Employees know the existing weaknesses in a new plan

PROBLEM FACED IN PREPARING PLAN

Cont Changes in the environment

WHY?
    

Economics Social and culture Customers Suppliers Technology

FORCES OF CHANGES
ORGANIZATION STRUCTURE

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FORCES OF CHANGES

TECHNOLOGY
Technology is like a two-edged sword that can make our lives easier or worse. The Internet has revolutionized the way in which information is exchanged, communication facilitated and commerce conducted. Technology is rapidly changing and effective management demands more knowledge in these areas in order for companies to manage their resources and develop, maintain or keep their competitive edge.

STRATEGIES TO REDUCES RESISTANCE OF CHANGES

Education & communication Participation Facilitation & support Negotiation Coercion

STRATEGIES TO REDUCES RESISTANCE OF CHANGES

Cont

Education & communication

 Provide adequate information to your members on the need for change in order to gain their support.  Make the purpose of the change clear. Fear of change can be as disturbing as the change itself.

STRATEGIES TO REDUCES RESISTANCE OF CHANGES

Cont

Participation
 Involve everyone in planning and making the change.  It is much easier to support something you have a stake in.  If possible, committees using small groups of people should be set up to review and make recommendations for change.  Surveys and newsletters are also tools that can be used.

STRATEGIES TO REDUCES RESISTANCE OF CHANGES

Cont

Support
 

Be prepared to spend extra time with members who have difficulty accepting the change. change. Ensure that you, as the person initiating the change, are seen as trustworthy and credible. credible.

STRATEGIES TO REDUCES RESISTANCE OF CHANGES

Cont

Negotiation
  

Work out a win-win situation for all parties involved. Match the personal goals of the members to the objectives of the change. The change will be resisted if it blocks personal goals.

Planning