BBA 1564 Principles Of Management PDF

BBA 1564 ninth edition BBA 1564 STEPHEN P. ROBBINS MARY COULTER PRINCIPLES OF MANAGEMENT 1PowerPoint Presentat...

BBA 1564 ninth edition BBA 1564 STEPHEN P. ROBBINS MARY COULTER PRINCIPLES OF MANAGEMENT 1PowerPoint Presentation by Charlie Cook The University of West Alabama BBA 1564 ninth edition STEPHEN P. ROBBINS MARY COULTER Planning TOPIC 2 PowerPoint Presentation by Charlie Cook The University of West Alabama Chapter 2: Planning Learning Outcomes Successful students will be able to:  Discuss the nature and purposes of planning.  Describe the types of plans.  Explain what managers do in the strategic management process.  Identify factors for effective planning. 2005V1.0 MGT104 3 What is Planning and Why Do Managers Need to Plan? Planning: is the first function or the primary function of management. is important to ensure that everyone is clear of what to accomplish. helps organization to adjust towards the environment. is being proactive rather than reactive which can increase the organization’s survival rate. 2005V1.0 MGT104 4 Why Should Managers Formally Plan? Why should managers want to plan? What impact does planning have on performance? Purposes of Planning planning establishes coordinated effort. planning also reduces uncertainty. planning reduces overlapping and wasteful activities. planning establishes goals or standards. 2005V1.0 MGT104 5 Planning in the Hierarchy of Organizations Some textbooks Include tactical plans as well 2005V1.0 MGT104 6 Hierarchy Of GOALS Organizationa Strategic l Plans Plans Operational for nonrecurring Plans for recurring activities activities Single-Use Plans Standing Plans Programs Policies Budgets Projects Standard Procedures and Methods 2005V1.0 MGT104 Rules 7 Different Types of Plans and Planning 2005V1.0 MGT104 8 Types of Plans and Planning Strategic Plans Plans that apply to the entire organization purpose / direction. Strategic plans are made by the top management for the whole organization. Strategic plans are usually done for 5 years and above. Manager has to come out with strategic goals which are long term, organization wide goals set by top management when doing strategic planning. 2005V1.0 MGT104 9 What Do Managers Need to Know About Strategic Management? Effective managers around the world recognize the role that strategic management plays in their organization's performance. What Is Strategic Management? Strategic management is that set of managerial decisions and actions that determines the long run performance of an organization. 2005V1.0 MGT104 10 What Do Managers Need to Know About Strategic Management?  Why is Strategic Management Important?  It can make a difference in how well an organization performs.  Managers in organizations of all types and sizes face continually changing situations.  Organizations are complex and diverse, and each part needs to work together to achieve the organization’s goals. 2005V1.0 MGT104 11 What Do Managers Need to Know About Strategic Management?  What Are the Steps in the Strategic Management Process?  STEP 1: Identify the organization’s current mission, goals, and strategies.  STEP 2: Doing an external analysis.  STEP 3: Doing an internal analysis.  STEP 4: Formulating strategies.  Step 5: Implementing strategies.  STEP 6: Evaluating results. 2005V1.0 MGT104 12 2005V1.0 MGT104 13 What Strategic Weapons Do Managers Have? 1 Quality as a strategic weapon. 2 Social media as a strategic weapon. 3 Big data as a strategic weapon. 2005V1.0 MGT104 14 What Strategies Do Managers Use? 1 Corporate Strategy Growth strategy Stability strategy Renewal strategy 2 Competitive Strategy Important role of competitive advantage. There are types of competitive strategies. 2005V1.0 MGT104 15 Types of Plans and Planning (cont’d) Tactical Plans Plans done by middle level management. Tactical plans are done for a period of 1 – 5 years span. Plans that basically focus on the problems of resources allocation. Manager has to come out with tactical objectives which are short term goals set by middle management that has to be achieved in order to reach top management’s strategic goals. 2005V1.0 MGT104 16 Types of Plans and Planning (cont’d) Operational Plans Plans developed by first line managers in support of tactical plans. It is the first line manager’s tools for executing daily, weekly and monthly activities. Operational plans has 2 major categories: single use plan and standing plan. 2005V1.0 MGT104 17 Types of Plans and Planning (cont’d) Single Use Plan  Plan made for a ONE TIME activity where an activity that does not occur again.  Once the activity is completed, the plan is no longer needed. 2005V1.0 MGT104 18 Types of Plans and Planning (cont’d) Standing Plan Plans that specifies how to handle continuing or recurring activities. Once the plan is made, it is useful over many years. For example: policies, procedures, rules. 2005V1.0 MGT104 19 Policies, Procedures, Rules, Programs and Budgets  Policies – general guideline statements which indicate appropriate actions to be taken for various situations.  Procedures – a lower level policy, which has a series of steps undertaken to carry out a particular task.  Rules – planning instruments that are even more specific than procedures. Little or no discretion allowed.  Programs – operational projects which may be separated from organization's mainstream activities.  Budgets – formal statements of financial resources and targets. They represent allocations of time, space, manpower or equipment and provide a basis for effective control in an organization. 2005V1.0 MGT104 20 Basic Steps in Planning Step 7 Control and evaluate the results 2005V1.0 MGT104 21 Planning Process Step 1: Set objectives Establish the objectives and targets while taking into consideration the mission, strategic plans/goals, environment and availability of resources. 2005V1.0 MGT104 22 Planning Process (cont’d) Step 2: Analyze & evaluate the environment  Once the objectives are established, manager must analyze their current situation and environment (internal & external) to determine what resources are available. 2005V1.0 MGT104 23 Assessing the Environment Environmental Scanning  The screening of large amounts of information to anticipate and interpret change in the environment. Competitor Intelligence  The process of gathering information about competitors—who they are; what they are doing. Is not spying but rather careful attention to readily accessible information from employees, customers, suppliers, the Internet, and competitors themselves.  May involve reverse engineering of competing products to discover technical innovations. 2005V1.0 MGT104 24 Benchmarking The search for the best practices among competitors and non-competitors that lead to their superior performance. By analyzing and using these practices, firms can improve their performance. 2005V1.0 MGT104 25 Planning Process (cont’d) Step 3: Identify alternatives List or identify as many alternatives as possible to reach the goals. 2005V1.0 MGT104 26 Planning Process (cont’d) Step 4: Evaluate the alternatives Evaluate all the alternatives to determine which one or combination of alternatives is the most effective and efficient to achieve the goals/objectives. For each alternative, manager will look at the advantages and disadvantages. 2005V1.0 MGT104 27 Planning Process (cont’d) Step 5: Select the best solution Select the course of action/alternative that gives the most advantages and fewest serious disadvantages and is within the resources available and time limit. 2005V1.0 MGT104 28 Planning Process (cont’d) Step 6: Implementing the plan Determine who will be involved, what resources will be needed, how the plan will be evaluated and how reporting will be handled. 2005V1.0 MGT104 29 Planning Process (cont’d) Step 7: Controlling & evaluating the results Monitor to ensure the plan is going according to expectations and make necessary adjustment, if needed. 2005V1.0 MGT104 30 Project Control Using Gantt Charts - a way of controlling & evaluating results Gantt Chart A bar graph with time on the horizontal axis and activities to be accomplished on the vertical axis. Shows the expected and actual progress of various tasks. 2005V1.0 MGT104 31 A Gantt Chart 2005V1.0 MGT104 32 Ansoff’s product/market matrix Product New Existing Market You start a Develop new Existing business here products Move to Diversify new New markets 2005V1.0 MGT104 33 Forecasting Techniques Quantitative Time series analysis Trend Line models Qualitative Judgemental Sales force opinion Customer surveys 2005V1.0 MGT104 34 Forecasting Methods / Time Horizons Long Range Planning Judgemental Method (Qualitative) Mid Term Planning Causal Method (Exploratory, cause and effect) Short-Term Planning Time Series Methods (Quantitative) 2005V1.0 MGT104 35 Three Basic Categories To Forecasting Judgemental Causal Time-Series Market Regression Naive method surveys Analysis Sales opinion Simple average Delphi Moving average method Weighted moving average Exponential 2005V1.0 MGT104 smoothing 36 Some Examples 0-3 months 3 months – 2 years > 2 years Inventory Staff planning Facility location management Final assembly Production Capacity scheduling planning planning Workforce Master Process Design scheduling production scheduling Master Purchasing Process design production scheduling Distribution 2005V1.0 MGT104 37 Ways to Make Plans Effective 1. Clearly define the mission of organization with detailed time frame and strategies. 2. Organization needs to emphasize the importance of planning and to eliminate fear of change. 2005V1.0 MGT104 38 Ways to Make Plans Effective (cont’d) 3. Ensure there is effective communication and information flow so that there is transparency and therefore able to get cooperation from employees. 4. Obtain commitment and support from top management. 2005V1.0 MGT104 39 Ways to Make Plans Effective (cont’d) 5. Encourage employees at all levels to provide feedback and suggestions for planning to obtain their commitment. 6. Develop contingency plans and strategies. 2005V1.0 MGT104 40 Ways to Make Plans Effective (cont’d) 7. Must acquire facts and information that are as current and reliable as possible to be accurate in planning. 8. Practice Management by Objective (MBO) which is a technique that emphasize collaboration objective setting by managers and subordinates. 2005V1.0 MGT104 41 Barriers to Planning 1. Some managers are NOT experienced in planning. 2. Managers prefer to react to situations rather than being proactive and anticipate the future through planning. 2005V1.0 MGT104 42 Barriers to Planning (cont’d) 3. Inferior information whereby the information obtained is outdated and inaccurate. 4. The mission statement and objectives of organization are not clear and precise enough for planning. 2005V1.0 MGT104 43 Barriers to Planning (cont’d) 5. Planning is NOT done or conducted systematically. 6. Review of plan not sensitive enough to environment changes. 7. Lack of interaction, cooperation and integration among departments in organization. 2005V1.0 MGT104 44 Barriers to Planning (cont’d) 8. Planning means changing from the current situation to new plans. Some managers are afraid to change thus they refuse to plan. 9. Managers have negative thinking of planning as they think that planning is costly, time consuming and waste of time. 2005V1.0 MGT104 45