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    Planning and DM Session 2

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    Gloriaeyram
    Planning and decision making are important organizational processes. Planning involves setting goals and determining how to achieve them, while decision making selects a course of action from alternatives. Effective planning requires identifying goals at multiple levels - strategic, tactical, and operational. Organizations develop various plans like strategic, tactical, and operational plans with different timeframes. Management by objectives involves collaborative goal setting between managers and subordinates. The rational decision making process recognizes problems, identifies alternatives, evaluates them, selects the best option, implements it, and provides follow up. Strategy determines the long term direction of an organization and how it can gain advantage through resource configuration. Strategic management involves strategy formulation, implementation, and evaluation.

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    Planning and DM Session 2

    Uploaded by

    Gloriaeyram
    95 views17 pages
    Planning and decision making are important organizational processes. Planning involves setting goals and determining how to achieve them, while decision making selects a course of action from alternatives. Effective planning requires identifying goals at multiple levels - strategic, tactical, and operational. Organizations develop various plans like strategic, tactical, and operational plans with different timeframes. Management by objectives involves collaborative goal setting between managers and subordinates. The rational decision making process recognizes problems, identifies alternatives, evaluates them, selects the best option, implements it, and provides follow up. Strategy determines the long term direction of an organization and how it can gain advantage through resource configuration. Strategic management involves strategy formulation, implementation, and evaluation.

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    Planning and decision making are important organizational processes. Planning involves setting goals and determining how to achieve them, while decision making selects a course of action from alternatives. Effective planning requires identifying goals at multiple levels - strategic, tactical, and operational. Organizations develop various plans like strategic, tactical, and operational plans with different timeframes. Management by objectives involves collaborative goal setting between managers and subordinates. The rational decision making process recognizes problems, identifies alternatives, evaluates them, selects the best option, implements it, and provides follow up. Strategy determines the long term direction of an organization and how it can gain advantage through resource configuration. Strategic management involves strategy formulation, implementation, and evaluation.

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    95 views17 pages

    Planning and DM Session 2

    Uploaded by

    Gloriaeyram
    Planning and decision making are important organizational processes. Planning involves setting goals and determining how to achieve them, while decision making selects a course of action from alternatives. Effective planning requires identifying goals at multiple levels - strategic, tactical, and operational. Organizations develop various plans like strategic, tactical, and operational plans with different timeframes. Management by objectives involves collaborative goal setting between managers and subordinates. The rational decision making process recognizes problems, identifies alternatives, evaluates them, selects the best option, implements it, and provides follow up. Strategy determines the long term direction of an organization and how it can gain advantage through resource configuration. Strategic management involves strategy formulation, implementation, and evaluation.

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    of 17

    Essentials of Management

    Session 2
    Planning , Decision Making and strategy

    [email protected]

    Planning and Decision making


    Planning is Setting organisational goals and
    deciding how best to achieve them.
    Decision making is part of the planning
    process that involves selecting a course of
    action from a set of alternatives.

    (Griffin, 2005, p10)

    Procter and Gamble (P&G) case


    Identify plans and DM activity.
    Double the revenue in 10 years
    Increase revenues by 25 percent or increase
    revenues by 3 times
    Diversification into new markets, cost cutting
    or buying competing businesses.

    Organisational goals
    Mission statement
    Strategic goals Goals set by and for the top
    management of the organisation.
    Tactical goals Operationalize actions?
    Operational goals Optimize operations.

    Organisational plans - Nature


    Strategic plans general plan outlining decisions
    on resource allocation, priorities and action steps
    necessary to facilitate long term strategic goals.
    Tactical plans implementing specific parts of
    strategic plans with specific focus. Effective
    tactical plan involves both development and
    execution
    Operational plans aims at achieving operational
    goals. Focussed on functional effeciency.

    Organisational plans - Timeframe

    Long range plans


    Intermediate plans
    Short range plans
    Contingency plans

    Operational plans
    Single use plans
    1. Program large set of activities. Complex steps
    2. Project less scope and more focus
    Standing plans
    1. Policies Framework or a guide for action
    2. Standard operating procedure (SOP) Steps to
    be followed
    3. Rules and regulations specific on how to carry
    out a particular activity

    Management by objectives (MBO)


    A formal goal-setting process involving
    collaboration between managers and
    subordinates; the extent to which goals are
    accomplished is a major factor in evaluating
    and rewarding subordinates performance

    MBO Process

    Starting formal goal


    setting program

    Establishment of
    organisational goals
    and plans

    Collaborating goal
    setting and planning

    Communicating
    organisational goals
    and plans, meeting,
    verifying goals,
    counselling, resources

    Periodic review

    evaluation

    Decision making
    Act of choosing one alternative from among a
    set of alternatives (Griffin, 2005, p276)
    Types of decisions in organisations
    1. Programmed decisions structured and
    recurs with some frequency
    2. Non-programmed decisions unstructured
    and ocurs less often

    Rational decision making process


    Recognising and
    defining decision
    situation

    Identifying
    alternatives

    Evaluating
    alternatives

    Selecting the best


    alternative

    Implementing

    Follow up and
    evaluation

    Stimulus positive or negative


    Ex employee turnover has increased by 5%

    Generating obvious and creative alternatives


    Ex Increase wages, benefits, change hiring standards

    Feasibility, satisfaction, consequences


    Increased benefits may not be feasible. Increasing wages or Changing hiring standards may benefit the organisation

    Choose the alternative that best fits the situation


    Changing hiring standards is time consuming so increase wages

    Implemented into the organisational system


    Approval from top mgmt. establishing new wage system by HR

    Periodically Ascertain the alternative chosen and implemented against results


    Six months later, drop in the turnover

    Strategy
    Strategy is the direction and scope of an organisation
    over the long term, which achieves advantage in a
    changing environment through its configuration of
    resources and competences with the aim of fulfilling
    stakeholder expectations Johnson et al (2005)
    Exploring Corporate Strategy p.9
    Strategic management is a comprehensive and
    ongoing management process aimed and formulating
    and implementing effective strategies.

    Strategic management
    Types of strategies
    1. Corporate level strategies
    2. Business level strategies

    1.
    2.
    3.

    Steps in strategic management


    Strategy formulation
    Strategy implementation
    Strategy evaluation

    Swot analysis for strategy formulation


    Strengths

    weaknesses

    Opportunities

    Threats

    Corporate level strategies


    1. Single product strategy
    2. Related diversification
    3. Unrelated diversification

    Business level strategies Porters


    generic strategies
    1. Differentiation strategy organisation seeks
    to differentiate itself from competitors
    through quality of its products and services
    2. Cost-leadership strategy organisation aims
    to gain competitive advantage by reducing
    its cost below cost of competitors
    3. Focus strategy organisation concentrates
    on specific regional market or product line

    Summary

    Thank you..

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