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    Aca130-Oma121 Chapter 6

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    The document discusses planning, strategy, and competitive advantage. It defines planning as a process managers use to identify goals and actions. Strategy is a cluster of decisions about goals, actions, and resource allocation. The planning process involves determining the mission/goals, formulating strategies, and implementing strategies. There are three levels of planning: corporate, business, and functional. Planning is important as it provides direction, guides decision-making, aligns functions, and controls managers.

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    Aca130-Oma121 Chapter 6

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    kingzeus8976
    19 views14 pages
    The document discusses planning, strategy, and competitive advantage. It defines planning as a process managers use to identify goals and actions. Strategy is a cluster of decisions about goals, actions, and resource allocation. The planning process involves determining the mission/goals, formulating strategies, and implementing strategies. There are three levels of planning: corporate, business, and functional. Planning is important as it provides direction, guides decision-making, aligns functions, and controls managers.

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    The document discusses planning, strategy, and competitive advantage. It defines planning as a process managers use to identify goals and actions. Strategy is a cluster of decisions about goals, actions, and resource allocation. The planning process involves determining the mission/goals, formulating strategies, and implementing strategies. There are three levels of planning: corporate, business, and functional. Planning is important as it provides direction, guides decision-making, aligns functions, and controls managers.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    19 views14 pages

    Aca130-Oma121 Chapter 6

    Uploaded by

    kingzeus8976
    The document discusses planning, strategy, and competitive advantage. It defines planning as a process managers use to identify goals and actions. Strategy is a cluster of decisions about goals, actions, and resource allocation. The planning process involves determining the mission/goals, formulating strategies, and implementing strategies. There are three levels of planning: corporate, business, and functional. Planning is important as it provides direction, guides decision-making, aligns functions, and controls managers.

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    © All Rights Reserved
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    Download as pptx, pdf, or txt
    of 14

    Chapter 6

    Planning, Strategy and


    Competitive Advantage
    ACA130 - ORGANIZATION AND MANAGEMENT
    OMA121 - INTRODUCTION TO BUSINESS ADMINISTRATION
    Overview
    In fast-changing competitive environments, managers should continually
    evaluate:

    - How well products are meeting customers needs.

    - Engage in systematic planning to find new strategies to meet customers needs.


    Planning and Strategy
    Planning: is a process managers use to identify and select appropriate goals and
    actions for an organization.
    The organizational plan that results from the “planning process” details the:
    - Goals of the organization
    - Strategies that managers will implement to reach those goals.

    Strategy: is a cluster of decisions about what goals to pursue, what actions to


    take, and how to use resources to achieve goals.
    Planning Process
    The planning process is a three-step activity:

    1. Determining the organization’s mission and goals.


    (Mission Statement, Define the business, and establish major goals)
    2. Formulating strategy.
    (Analyze current situation and develop strategies)
    3. Implementing Strategy.
    (Allocate resources and responsibilities to achieve strategies)
    Mission Statement
    A mission statement is a broad declaration of an organization’s purpose that identifies:
    - The organization’s products.
    - The organization’s customers.
    - The organization’s competitors.
    The Nature of the Planning Process
    To perform the planning task, managers need to:
    1. Establish and discover where an organization is at the present time.
    2. Determine where it should be in the future; desired future state.
    3. Decide how to move it forward to reach that future state.

    A manager’s plan must forecast what might happen in the future to decide what to do in the
    present.
    Why is Planning Important?
    Four main reasons on the importance of planning:
    1. It gives the organization a sense of direction and purpose.
    2. It guides managers to take part in decision-making which supports the organization’s goals
    and strategies.
    3. It directs managers of different functions and departments to be on the same path and
    work on achieving the future desired state.
    4. A plan can be used as a device to control managers in an organization.
    Absence of Planning
    The absence of a plan may result in the following:

    - Hesitations.
    - False steps.
    - Mistakes.
    - Accidents.
    - Change of direction; which may hurt the organization.
    - It may also lead to disasters.
    Levels of Planning
    The three levels of planning:
    1. Corporate level
    - (CEO, Top management team, Corporate Office)
    2. Business level
    - (Divisions, Business Units)
    - (Ex. A General Electric Company has:
    GE Aircraft, GE Financial, GE Services, GE lighting, GE Motors, GE Plastics, etc.)
    3. Functional level
    - (Functions or Departments)
    - (Ex. Manufacturing, Marketing, Accounting, etc.)
    1. Corporate Level Planning &
    Strategy
    Corporate Level Planning:
    - Top Management decisions
    - Organization mission
    - Overall strategy
    - Structure

    Corporate Level Strategy: is a plan that specifies which industries and national markets an
    organization intends/aims to compete.
    2. Business Level Planning and
    Strategy
    Business Level Planning:
    - The long-term divisional goals that will allow the division to meet corporate goals
    - Division business strategy and structure

    Business Level Strategy: is a plan that indicates how a division intends to compete against its
    rivals/competitors.
    3. Functional Level Planning and
    Strategy
    Functional Level Planning:
    - Functional managers’ decisions.
    - Helps the division reach business-level goals.

    Functional Level Strategy: is a plan of action to improve the ability of an organization’s functions
    to perform task-specific activities.
    - it adds value to the organizations goods and services.
    Time Horizon of Planning
    Plans differ in time horizons.
    Time horizon: is the intended duration of a plan.

    Type of time horizons plans:


    1. Long-term plan (5 years or more)
    2. Intermediate-term plan (Between 1 to 5 years)
    3. Short-term plan (1 year or less)
    Standing Plans and Single-Use Plans
    Standing plans Single-Use Plans

    Used in situations which programmed Used in situations which a non-programmed


    decision-making is appropriate. decision-making is needed; a one-of-a-kind
    situation.

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