lecture 6(foundation of planning) Flashcards

1
Q

Planning

A

A primary managerial function that involves:
Defining the organization’s goals
Establishing an overall strategy for achieving those goals
Developing plans for organizational work activities

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2
Q

Formal Planning

A

Specific goals covering a specific time period
Written and shared with organizational members

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3
Q

Why Do Managers Plan ?

A

Provides direction
Reduces uncertainty
Minimizes waste and redundancy
Sets the standards for controlling

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4
Q

Planning is associated with

A

Higher profits and returns on assets.

Positive financial results.

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5
Q

Elements of Planning

A

Goals (Objectives) and plan

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6
Q

Goals (Objectives)

A

Desired (measurable) Outcomes for individuals, groups, and entire organizations

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7
Q

Plans

A

Documents how goals are to be accomplished
Describe how resources are to be allocated

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8
Q

Type of Goals

A

1-Strategic Goals
2-Financial Goals
3-Stated Goals

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9
Q

Strategic Goals

A

Related to the performance of the firm relative to factors in its external environment (e.g., competitors).

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10
Q

Financial Goals

A

Related to the expected internal financial performance of the organization

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11
Q

Stated Goals

A

Can be found in an organization’s annual report, public relations announcements, or in public statements

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12
Q

SMART Objectives

A

S: SPECIFIC
M: MEASURABLE
A: ATTAINABLE
R: RELEVANT
T: TIME-BOUND

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13
Q

Type of Plans

A

strategic and operational

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14
Q

strategic plan breadth

A

Apply to the entire organization.
Follows the organization’s overall goals.
Seek to position the organization in terms of its environment

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15
Q

strategic plan time frame

A

Plans with time frames extending beyond three years

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16
Q

strategic plan specifity

A

Directional Plans

Flexible plans that set out general guidelines and provide focus

17
Q

strategic plan frequency of use

A

Single Use Plans

A one-time plan specifically designed to meet the needs of a unique situation

18
Q

Operational Plans breadth

A

Specify the details of how the overall goals are to be achieved.

19
Q

Operational Plans time frame

A

Short Term Plans

Plans with time frames of one year or less

20
Q

Operational Plans specificity

A

Specific Plans
Plans that are clearly defined and leave no room for interpretation

21
Q

Operational Plans frequency of use

A

Standing Plans
Ongoing plans that provide guidance for activities performed repeatedly

22
Q

Traditional Goals Setting

A

Broad goals are set at the top of the organization.

Goals are then broken into sub-goals for each organizational level.

Assumes that top management knows best because they can see the “big picture”.

Goals are intended to direct and guide.

Goals lose clarity and focus as lower-level managers attempt to interpret and define the goals for their areas of responsibility.

23
Q

Management by Objectives (MBO)

A

Specific performance goals are jointly determined by employees and managers.

Progress toward accomplishing goals is periodically reviewed.

Rewards are allocated on the basis of progress towards the goals.

24
Q

Key elements of MBO:

A

Goal specificity,
participative
decision making
an explicit performance/evaluation period,
feedback

25
Q

Reasons for MBO Success

A

Top management commitment and involvement

26
Q

Potential Problems of MBO

A

Not as effective in dynamic environments that require constant resetting of goals

27
Q

Characteristics of Well-Written Goals

A

1-Written in terms of outcomes, not actions
2-Measurable and quantifiable
3-Clear as to time frame
4-Challenging yet attainable
5-Written down
6-Communicated to all necessary organizational members

28
Q

Steps in Goal Setting

A
  1. Review the organization’s mission statement.
  2. Evaluate available resources
  3. Determine goals individually or with others.
  4. Write down the goals and communicate them.
  5. Review results and whether goals are being met.
29
Q

what are the Contingency Factors in Planning

A
  1. Manager’s level in the organization
  2. Degree of environmental uncertainty
30
Q

Manager’s level in the organization

A

Strategic plans at higher levels
Operational plans at lower levels

31
Q

Degree of environmental uncertainty

A

Stable environment: specific plans
Dynamic environment: specific but flexible plans

32
Q

what are the Approaches to Planning

A
  1. Establishing a formal planning department
  2. Involving organizational members in the process
33
Q

Criticism of Planning

A

Planning may create rigidity.
Plans cannot be developed for dynamic environments.
Formal plans cannot replace intuition and creativity.
Planning focuses managers’ attention on today’s competition not tomorrow’s survival.
Just planning isn’t enough.