Foundations of Planning: Chapter 7 Quiz

Planning and Performance

• Research has shown that planning has a positive relationship with organizational performance.
• However, the extent of planning is not the most significant factor affecting performance; other factors, such as the quality of planning, have a greater impact.

Types of Goals and Planning

• Organizations may have different types of goals, including:
  • Strategic goals, which relate to the organization's overall mission and objectives
  • Tactical goals, which are specific and focused on achieving specific objectives
• There are two main types of planning:
  • Strategic planning, which covers the entire organization and establishes overall goals
  • Operational planning, which specifies the details of how the overall goals are to be achieved and covers a short time period

Purpose of Planning

• The primary purpose of planning is to define the organization's goals, establish an overall strategy, and develop plans for organizational work activities.

Traditional Goal Setting and MBO

• Traditional goal setting involves setting specific, measurable, achievable, relevant, and time-bound (SMART) goals.
• Management by Objectives (MBO) is a goal-setting approach that involves:
  • Setting specific, measurable goals
  • Establishing key performance indicators (KPIs)
  • Regularly reviewing and feedback

Effective Planning in Dynamic Environments

• To plan effectively in today's dynamic environment, managers must:
  • Be flexible and adaptable
  • Monitor and respond to changes in the environment
  • Involve employees in the planning process

Criticisms of Planning

• Planning has been criticized for:
  • Being too rigid and inflexible
  • Focusing on short-term goals rather than long-term objectives
  • Being detached from reality

Managing by Objectives

• MBO involves setting specific, measurable, achievable, relevant, and time-bound (SMART) goals.
• Goals are written and shared with organizational members to provide direction and evaluation criteria.

Planning and Goal Setting

• Long-range plans cover extended periods of time and establish the organization's overall goals.
• Goals are desired outcomes for individuals, groups, or entire organizations that provide direction and evaluation performance criteria.

Goal Categories

• Financial goals are related to the expected internal financial performance of the organization.

Planning Effectiveness

• Planning must be used consistently for several years before it begins to affect performance.