U3 Ch.10-12 Activities Flashcards
SMART plans
All plans should be SMART:
-Specific
-Measurable
-Achievable [realistic]
-Relevant [to business goals]
-Timed [target date]
Steps in planning
- Assess the current situation (SWOT)
- Set a goal (short/long term)
- Create plan
- Implement plan
- Review plan
mission statement
short written statement that sets out the firm’s overall goal for the lifetime of the business
Types of plan
Strategic
Tactical
Operational
Contingency
Human Resource / Manpower
Financial
Mission statement
Marketing plan
Strategic Plan
usually up to 5 years long term goals written by senior management. Breaks down mission statement into long-term plans. E.g. Increase market share by 25% in the next five years
Tactical Plan
1-2 years short term goals written by middle management. Breaks strategic plan into short-term plans. Makes the strategic plan possible. E.g. Launch new advertising campaign in the next 12 months
Operational Plan
Outline daily, weekly or monthly targets written by all management levels. Plans for daily running of a business. E.g. weekly and monthly objectives for marketing/production
Contingency Plan
0-1 year written by all management levels. Back-up plans used to deal with unforeseen events or emergencies. E.g. if suppliers cannot provide raw materials, source materials from another supplier
Human Resource (Manpower) Plan
0-1 year written by HR manager. Ensures business has correct no. of employees, with correct skills and qualifications to fill all roles
Financial Plan
0-1 year written by Finance manager. Prepare cash flow forecasts to predict income received and spent in a period.
Stakeholders and Planning
- Investors (financial plan shows business can repay loans. It also shows projected profits which could lead to more dividends for shareholders)
- Employees (HR planning can indicate promotion opportunities and encourage them to work harder)
- Suppliers (Strategic+Tactical plans can indicate intention to expand allowing them to prepare more raw materials)
Benefits of planning
- Create Awareness & Give Direction. (All staff aware of targets)
- Helps decision making (long term objectives help make the most effective decisions)
- HR planning (avoids shortages and identifies when staff recruitment is needed)
- Benchmarking (monitor progress by comparing target with results)
- Obtain Finance
Types of organisation structure
- Functional
- Geographic
- Product
- Matrix/team-based
Functional Organisation Structure
Firm divided based on functions performed
1. Shareholders
2. Board of Directors
3. CEO
4. Production/Finance/etc. Director
5. Production Assitants/Accountants/etc.
Functional Organisation Structure Advantages
- Employee Motivation (clear promotional path)
- Expertise in departments
- Responsibilities are clear for all employees
Functional Organisation Structure Disadvantages
- Only focus on department goals
- Slow com. between departments
- Lack of Teamwork
Geographic Organisation Structure
Divided into geographical areas
1. Shareholders
2. Board of Directors
3. CEO
4. Ireland/England/France Directors
5. Ireland/England/etc. Production/FInance/etc. Managers
Geographic Organisation Structure Advantages
- Able to target local needs
- Friendly competition between geogrpahic units
- Prepares managers for promotion by training on national level before international
Geographic Organisation Structure Disadvantages
- Work Duplication
- Conflict (senior decisions may affect certain areas negatively)
- Poor communication between geographic units
Product Organisation Structure
Units based on type of product provided
1. Shareholders
2. Board of Directors
3. CEO
4. Pepsi / Pepsi Max Directors
5. Pepsi/Pepsi Max Finance/Production Managers
Product Organisation Structure Advantages
- Meet demand more effectively when specified
- Compare performance of each product through the unit
- Expert Knowledge
Product Organisation Structure Disadvantages
- Work Duplication
- Units in direct competition
- Poor Com. between units
Matrix Organisation Structure
Combines functional with a team-based approach. Employees work in individual Departments and come together to work in cross-functional teams. Employees have both department and project Managers.
Structure is the same as functional but there are project teams going horizontally that join staff from different departments
Matrix Organisation Structure Advantages
- Motivation (part of team)
- Com. (between departments with common goals and understanding)
- Better decisions (more knowledge + skills)