M3 Flashcards
important aspect of the firm’s operations because it provides road maps for guiding, coordinating, and controlling the firm’s actions
planning
2 phase of planning
short term goal
long term goal
more participation from the top management
long term goal
2 to 10 yrs
long term goal
focused on the direction of the company
long term goal
top management is involved but there is more participation from lower level management (production, marketing, personnel, finance)
short term
who are the ones who implement short term plans
lower management
1 year or less
short term goal
focused on the everyday functioning of the company
short term goal
financial planning process
- set goals or objectives
- identify resources
- identify goal-related tasks
- establish responsibility centers for accountability and timeline
- establish the evaluation system for monitoring and controlling
- determine contingency plans
long term and short term objectives are usually identified
- set goals or objectives
these can be seen in any company’s vision and mission statements
- set goals or objectives
states where the company wants to be
vision
state the plans on how to achieve the vision
mission
include production capacity and human resources who will man the operations and financial resources
- identify resources
each goal should have tasks or projects associated w/ its achievement
- identify goal-related tasks
different responsibilities must be established as well as a timetable for the activities
- establish responsibility centers for accountability and timeline
this can be done through quatified plans such as budgets and projected financial statements
- establish the evaluation system for monitoring and controlling
budget and projected financial statements are based on assumptions
- if assumptions are not realized = create alternative strategies to lessen the negative effects on the company
- determine contingency plans
characteristics of an effective plan
SMART
SMART
specific
measurable
assignable
realistic
time-related
target a specific area for improvement
specific
quantify or at least suggest an indicator of progress
measurable
specify who will do it
assignable
state what results can realistically be achieved, given available resources
realistic
specify when the results can be achieved
time-related
