Management Chapter 7

Strategic goals

Broad statements describing where the organization wants to be in the future. These goals pertain to the organization as a whole. Strategic plans define the steps by which the company intends to attain strategic goals.

Limitations of Planning

1. Goals and plans can create a false sense of certainty (can give managers a false sense that they know what the future will be like- planning is based on assumptions) 2. Goals and plans may cause rigidity in a turbulent environment (can lock the organization into specific goals which may no longer be appropriate) 3. Goals and plans can get in the way of intuition and creativity ( routine planning may hamper creativity and intuition)

Benefits of Planning

1. Goals and plans provide a source of motivation and commitment. (reduces uncertainty for employees because they know what they are working towards) 2. Goals and plans guide resource allocation 3. Goals and plans are a guide to action. (Planning focuses attention on targets and directs employee efforts toward important outcomes. (Helps know what actions to take) 4. Goals and plans set a standard of performance

Tactical Goals

The results that major divisions and departments within the organization intend to achieve. (comes after strategic goals) - Tactical plans are designed to help execute the major strategic plans and to accomplish a specific part of the company's strategy.

Mission Statement

A mission statement is a broadly stated definition of the organization's basic business scope and operations that distinguishes it from similar types of organizations. - It guides decisions and actions.

Levels of Goals and Plans

Diagram 7.1 Mission Statement -> Strategic goals/plans (senior management -> Tactical goals/plans (middle management) -> Operational goals/plans (lower management).

Operational Goals

The results expected from departments, work groups, and individuals. They are precise and measurable. - Operational plans are developed at the lower levels of the organization to specify action steps toward achieving operational goals and to support tactical plans.