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Chapter 8

Chapter 8 notes

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Department
Global Management Studies
Course
GMS 200
Professor
Shavin Malhotra
Semester
Fall

Description
Chapter 8: Planning and Controlling How and Why Managers Plan • Planning: is the process of setting objectives and determining how to accomplish them Importance of Planning • Planning done well, creates a solid platform for the other management functions o Organizing: allocating and arranging resources to accomplish taks o Leading: guiding the efforts of human resources to ensure high levels of task accomplishment o Controlling: monitoring task accomplishments and taking necessary corrective action • Can help stay on top of completion Planning Process • Objectives: are specific results that one wishes to achieve • Plan: is a statement of intended means for accomplishing objectives 1. Define your objectives 2. Determine where you stand vis a vis objectives 3. Develop premises regarding future conditions 4. Analyze and choose among action alternatives 5. Implement the plan and evaluate results Benefits of Planning • Planning improves focus and flexibility o Organization with focus knows what it does best, knows the needs of its customers, and knows how to serve them well www.notesolution.com o Individual with focus knows where he or she wasn’t to go in a career or situation and is able to retain that objective even when difficulties arise o Organization with flexibility is willing and able to change and adapt to shifting circumstances o Individual with flexibility adjusts career plans • Planning improves Action Orientation o Stay ahead of the competition and always become better at what they are doing o Avoid the complacency trap of simply being carried along by the flow of events o Convey good planning makes us: Results oriented Priority oriented Advantage oriented Change oriented • Planning improves coordination o Means end chain: lower level objectives help accomplish higher-level ones • Planning improves time management o Easy to lose track of time and fall prey to what consultants identify as time wasters o Distinguish between things that you must do (top priority), should do (high priority), would be nice to do (low priority), and really don’t need to do (no priority) • Planning improves control o Control making it easier to measure performance results and take action to improve things as necessary o Helps define objectives Planning Theories www.notesolution.com • Rational comprehensive planning (RCP): focuses on a logical decision-making approach and advocates a holistic approach to problem solving o Uses conceptual or mathematical models that relate ends (objectives) to means (resources and constraints) with a heavy reliance on statistical analysis • Major advantage is its simplicity. Logical, deliberate process • Disadvantage, somewhat unrealistic • Incrementalism: muddle through • Six key procedures for “disjointed incrementalism” o Instead of comprehensive survey and the evaluation for all alternatives, only focus on policies that different incrementally from existing policies o Only small amount of policy alternatives are considered o Each policy alternative, only a restricted number or important consequences evaluated o Problem confronting the decision maker is continually redefined: incrementalism allows for countless ends means and means ends adjustments o No one right decision or solution o Incremental decision making is described as remedial • Model recognizes that planning is continually being undertaken and revised • Incremental panning is limited in scope as it generally addresses only a small range of alternatives Types of Plans Used by Manager Short and Long Range Plans • Short range: cover one year or less • Intermediate range plans: cover one to two years • Long term plans: look three or more years into the culture Strategic and Operational Plans www.notesolution.com • Strategic plan: identifies long-term directions for the organization • Top management planning involves determining objectives for the entire organization and describing what and where the organizations wants to be in the future • Operational plans: identifies activities to implement strategic plans o Production plans: dealing with the methods and technology needed by people in ther work o Financial plans: dealing with money required to support various operations o Facilities plans: dealing with facilities and work layouts o Marketing plans: dealing with the requirements of selling and distributing goods or services o Human resource plans: dealing with the recruitment, selection, and placement of people into various jobs Policies and Procedures • Standing plans: form of organizational policies and procedures are designed for use over and over again • Policy: is a standing plan that communicates broad guidelines for decisions and action • Rules or Procedures: precisely describes actions that are to be taken in specific situations Budges and Projects • Single use plans: used once, serving the needs and objectives of well-defined situations in a timely manner • Budget: is a plan that commits resources to projects or activities • Fixed budget: allocates a fixed amount of resources for a specific purpose • Flexible budget: allows the allocation of resources to vary in proportion with various levels of activity • Zero-based budget: allocates resources as if each budget were brand new www.notesolution.com • Projects: are one time activities that have clear beginning and end points • Project management: makes sure that activities required to complete a project are accomplished on time and correctly • Project schedules: define specific task objectives, link activities to be accomplished with due dates, and identify the amounts and time of resource requirements Planning Tools and Techniques Forecasting • Forecasting: attempts to predict the future • Qualitative forecasting: expert opinions to predict the future • Quantitative forecasting: uses mathematical models and statistical analysis of historical data and surveys to predict future events • Forecasts should be treated cautiously, planning aids, not substitutes Contingency Planning • Contingency planning: identifies alternative courses of action to take when things go wrong • Never perfect • Changes in environment Scenario Planning • Scenario planning: identifies alternative future scenarios and makes plans to deal with each Benchmarking • Benchmarking: uses external comparisons to gain insights for planning • Purpose is to find out what other people and organizations are doing very well, and plan to incorporate these ideas into one’s own operations • Best practices: are things that lead to superior performance Use of Staff Planning www.notesolution.com •
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