Chapter 6 Managerial Planning and Goal Setting

Planning

Usually incorporates both ideas; it means determining the organization's goals and defining the means for achieving them.

Decentralized planning

Managers work with planning experts to develop their own goals and plans.

Levels of Goals and Plans

Mission Statement - the basis for the strategic company level of goals and plans, which in turn shapes the tactical level and operational level. Mission statement < Strategic Goals/Plans < Tactical Goals/Plans < Operational Goals/Plans

Standing plans

Ongoing plans that are used to provide guidance for task performed repeatedly within the organization.

Goal chracteristics

Specific and measurable Defined time period Cover key result areas Challenging but realistic Linked to rewards

Mission

The organizations reason for existence

Tactical goals

goals that define the outcomes that major divisions and departments must achieve for the organization to reach its overall goals.

Activities that make MBO successfull

1. Set goals 2. Develop action plans 3. Review progress 4. Appraise overall performance

MBO Problems

1. Constant change prevents MBO from taking hold. 2. An environment of poor employer-employee relations reduces MBO effectiveness. 3. Strategic goals may be displaced by operational goals. 4. Mechanistic organizations participation can harm MBO process. 5. Too much paper work saps MBO energy.

Organizational Planning Process

1. Develop the Plan 2. Translate the plan 3. Plan Operations 4. Execute the Plan 5. Monitor and Learn

MBO benefits

1. Manager and employee efforts are focused on activities that will lead to goal attainment 2. Performance can be improved at all company levels. 3.Employees are motivated. 4. Departmental and individual goals are aligned with company goals.

Plan

A blueprint specifying the resources allocations, schedules, and other actions necessary for attaining goals.

Goal

A desired future state that the organization attempts to realize

Management by Objectives

A method of management whereby managers and employees define goals for every department, project, and person and use them to monitor subsequent performance.

Strategy map

A visual representation of the key drivers of an organization's success showing the cause-and-effect relationships among goals and plans.

Strategic goals

Broad statements of where the organization wants to be in the future; pertain the organization as a whole rather than to a specific division or departments.

Strategic plans

Define the action steps by which an organization intends to attain strategic goals.

Central planning departments

Groups of planning specialist who report directly to the CEO

Purposes if Goals and Plans

Legitimacy Source of motivation and commitment Resource allocation Guides to action Rationale for decisions Standard of performance

Tactical plans

Plans designed to help execute major strategic plans and to accomplish a specific part of the company's strategy.

Operational plans

Plans developed at the organization's lower levels that specify action steps towards achieving operational goals and that support tactical planning activities.

Single-use plan

Plans that are developed to achieve a set of goals that are unlikely to be repeated in the future.

Contingency Plans

Plans that define company responses to specific situations, such as emergencies, setbacks, or unexpected conditions.

Crisis planning

Prevention 1. Build relationships 2. Detect signals from environment Preparation 1. Designate crisis management team and spokesperson 2. Create detailed crisis management plan 3. Set up effective communications system

Stretch goal

are reasonable yet highly ambitious goal that are so clear and compelling and imaginative that they fire up employees and engender excellence.

Performance dashboard

as ways for executives to keep track of performance metrics

Scenario building

involves looking at current trends and discontinuities and visualizing future alternative futures to build a framework within which unexpected future events can be managed.

Mission Statement

is a broadly stated definition of purpose that distinguishes the organization from others of a similar type.

Intelligence team

is a cross-functional group of managers and employees who work together to gain a deep understanding of a specific issue and offer insight and recommendations for planning.

Operational goals

specific, measurable results expected from departments, work groups, and individuals within the organization.