Planning
Chapter 6
with Duane Weaver
Outline
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Purpose of planning
Well designed goals
Types of plans
Criticisms of Formal Planning
Purpose of Planning
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Reduces uncertainty
Reduces overlaps and waste
Establishes goals and standards for
controlling
Planning = Performance:
1. higher profits,
2. quality of plan counts,
3. external environment breeds poor performance,
not the plan, and
4. planning timeframe of 4yrs. of consistency to see
outcomes.
Well Designed Goals
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Written in terms of outcomes
Measurable and quantifiable
Clear time frame
Realistic (challenging yet attainable)
Written down (recorded)
Communicated (to all necessary)
Types of Plans
• Strategic – overall org goals & position
(intent/leverage)
• Operational – define how overall goals are to be
achieved (tactics)
• Long-Term – more than 3 years
• Short-Term – 1 year or less
• Specific – clearly defined rules of engagement,
no room for interpreting
• Directional – flexible with general guidelines
• Single-use – e.g.: start up, install, introduction
• Standing – ongoing procedures for repeated
activities (e.g.: SOP=standard operating
procedure)
Criticisms of Formal
Planning
• May create rigidity
• Tough to create for dynamic environments
• Plans cannot replace intuition and
creativity
• Focus mgmt. on today’s competition vs.
tomorrow’s survival
• Reinforces success – restricts willingness
to adapt, could lead to failure