Engineering Management (ENSC 20042) Lecture Notes - Planning - October 4, 2024 PDF

ENGINEERING MANAGEMENT (ENSC 20042) Lecture # 2 :PLANNING Engr. Romeo G. Ilagan , PIE , AAE Lecturer October 4, 2024  PLANNING What is planning ?. PLANNING is a logical and systematic approach of formulating objectives , programs, policies , procedures , and...

ENGINEERING MANAGEMENT (ENSC 20042) Lecture # 2 :PLANNING Engr. Romeo G. Ilagan , PIE , AAE Lecturer October 4, 2024  PLANNING What is planning ?. PLANNING is a logical and systematic approach of formulating objectives , programs, policies , procedures , and budgets, rules and regulations , and other types of plans.  WHAT IS PLANNING ? Planning is deciding in advance what to do and how the work will be done. PLANNING DEFINED PLANNING IS SIMPLY ANSWERING THE FFG QUESTIONS:  THE NATURE OF PLANNING Four major factors summarize the essential nature of planning: 1.Contribution to purpose and objectives -to facilitate accomplishment of business purposes and objectives. 2. Planning as the first basic function -planning is logically performed before the execution of all other managerial functions.  THE NATURE OF PLANNING Four major factors summarize the essential nature of planning: 3. Planning as a function of all managers. - though the character and scope of planning will differ from one authority to another. 4. Planning for efficient organization.  - The efficiency of a plan is evaluated by the amount it contributes to the purpose and objective offset by the expenses and other things required to formulate and implement it.  IMPORTANCE OF PLANNING : 1. To offset uncertainty and change Planning shows the organization to determine the constraints , specify the planned target , select the number of options , monitor and control the implementation so as allow re planning if necessary. 2. To focus attention to planned targets. It unifies the work activities of the different personnel of the organization to act as one party.  IMPORTANCE OF PLANNING : 3. To gain economical and efficient operation. It minimizes cost. Its emphasis is on efficient and effective operations and consistency of procedures and methods. 4.To facilitate control. Managers cannot always check on the accomplishments or failures of their subordinates.  WHY MANAGERS FAIL?.... 1. Lack of real commitment in planning. 2.Interchanging planning studies with plans. 3.Failure to develop and implement sound strategies. 4.Lack of meaningful objectives and goals. 5.Tendency to underestimate the importance of planning premises. 6.Failure to see the scope of plans.  WHY MANAGERS FAIL?.... 7.Failure to see planning as a rational process. 8.Too much reliance on experience. 9.Failure to use the principle of limiting factor. 10.Lack of top management support. 11.Lack of clear delegation. 12.Lack of adequate control techniques and information. Plans should be S-M-A-R-T S – Simple M- Measurable A – Attainable R – Realistic T – Time bounded  GUIDELINES FOR GOOD PLANNING : 1. A plan should have specific planned targets. 2. A good plan should facilitate action. 3. If many people are involved in planning, coordination, and communication are very important to arrive at realistic results. 4. Good plans can be constantly improved, redrafted ,and re planned. What may change are strategies and programs of achieving the planned targets. 5. Planning may be delegated to a formal training staff or group within the company. 5. All plans are tentative and interim. They are never final. They should be flexible , not rigid.  WHAT ARE OBJECTIVES ? OBJECTIVES DEFINED ❖-are clear cut and carefully considered statements designed to give an organization and its members direction and purpose. ❖-synonymous to aim , purpose , goal and mission. ❖-are established at organizational, departmental , or individual level.  KINDS OF OBJECTIVES : ❖Organizational Objectives – deal with the general and purposes of an organization. ❖Managerial /Departmental Objectives – identify the goals of particular department , or organizational segment. ❖Individual Objectives – are personalized objectives which outline what individuals in the group are trying to accomplish.  CHARACTERISTICS OF OBJECTIVES 1.Must be specific/ clear / concise – gives precise meaning to the manager. Example : to maximize growth by 12 %. 2.Must be practical – must be within the capacity of the individual or group to achieve. 3.Must be quantifiable or measurable Example : to increase the production of Coca – Cola’s 8 ounce soft drink by 12 % by Aug. 2019  TYPES OF SETTING OBJECTIVES 1. Profitability -This can be measured in terms of profit , ROI , EPS.. 2. Customer Service -Can be expressed in a very explicit terms. ex. To reduce the number of complaints by… 3. Employee – Management Needs and well being -this may be quantitatively expressed in terms of number of grievances, training , etc.  SOCIAL RESPONSIBILITY CORPORATE SOCIAL RESPONSIBILITY (CSR) – is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce as well as the local community and society at large. CORPORATE SOCIAL RESPONSIBILITY  EXAMPLES OF COMPANY’S CSR: PETRON Petron CSR programs are under the umbrella program called Project H.O.P.E. – Helping Filipino children and youth Overcome Poverty Through Education.  EXAMPLES OF COMPANY’S CSR: PROCTER AND GAMBLE (P & G) We demonstrate our commitment to social responsibility by providing products and services that improve consumers’ lives, in terms of health, hygiene and convenience. “Live , Learn and Thrive : The P & G Corporate cause.  EXAMPLES OF COMPANY’S CSR: Globe Bridging Communities ( Globe Bridge Com) is Globe Telecom’s integrated CSR program aimed at serving the communities where its business operates. Its main thrust is to empower community leaders, propagate entrepreneurship, improve education through IT and assist in various community development initiatives in the barangays.  EXAMPLES OF COMPANY’S CSR: “Doing well , Doing good”. The company’s corporate citizenship goes beyond its commitment to its consumers, employees, and key stakeholders in government and the communities it operates.  EXAMPLES OF COMPANY’S CSR: The Bank demonstrates its CSR by embarking an supporting various socio- civic programs as well as environmental and educational projects. Example : SM Foundation - it helps the less fortunate in the communities it serves within the vicinity of SM Department stores and super malls that need assistance.  EXAMPLES OF COMPANY’S CSR: Yamaha Motor group has the company pledge defining “ Contribute to society through our corporate activities”. It defines it corporate mission as “ Kando Creating Company” which means that the company is offering new excitement and a more fulfilling life for people all over the world. UNIFIED FRAMEWORK OF PLANS ( COORDINATED PLAN) CEO , VPS MIDDLE MANAGEMENT FIRST LINE OR SUPERVISORY LEVEL  VISION FRAMEWORK ❑Any organization needs a vision framework that includes its guiding philosophy, core values and beliefs and purpose. ❑These should be combined into a mission, which provides a vivid description of what things will be like when it has been achieved.  VISION FRAMEWORK VISION OR GUIDING PHILOSOPPHY  ( what you want to be ) CORE VALUES AND BELIEFS PURPOSE (Who you want to be ) (what you are here for ) MISSION (what you will do) VISION…… Vision Statement: (Desired End-State) A one-sentence statement describing the clear and inspirational long-term desired change resulting from an organization or program’s work. The best visions are inspirational, clear, memorable, and concise. The guiding philosophy drives the organization and is shaped by the leaders through their thoughts and actions. It should reflect the vision of the of the organization rather than the vision of a single leader and should evolve with time , although organizations must hold to the core elements MISSION….. Mission – is a clear statement about why the organization exists. It can be defined in terms of an organization’s products /services or markets / customers. Is your mission statement longer than 20 words? Can you get it below 15? Below10? Design it to clearly communicate what you do in such a way that people can remember it and communicate this to others. If you can’t get a mission statement below 55 words, consider also creating a mission tagline (2-6 words) which people can more easily remember. EXAMPLES OF VISION AND MISSION STATEMENTS Example of VISION Statements: The Nature Conservancy: To leave a sustainable world for future generations. (8) In Touch Ministries: Proclaiming the Gospel of Jesus Christ to people in every country of the world. (14) Cleveland Clinic: Striving to be the world’s leader in patient experience, clinical outcomes, research and education. (14) Example of MISSION Statements: The Nature Conservancy: To conserve the lands and waters on which all life depends. (11) In Touch Ministries: To lead people worldwide into a growing relationship with Jesus Christ and to strengthen the local church. (17) Cleveland Clinic: To provide better care of the sick, investigation into their problems, and further education of those who serve. (18) CORE VALUES & BELIEFS, PURPOSE …. Core values and beliefs – represent the organization’s basic principles about what is important to the business , its conduct , its social responsibility and its response to changes in the environment , Purpose -of the organization should be a development from the core values and beliefs and should quickly and clearly convey how organization is to fulfill its role.  VGMO -SMART COMMUNICATIONS INC.(PHILIPPINES ) Our Vision… ❑Lead and Inspire Filipinos to Create a Better Tomorrow. Our Mission…. ❑Empower Filipinos everywhere with customer-focused digital innovations that unlock and share their infinite potential. Our Values… ❑Deliver awesome customer experiences ❑Take care of our people ❑Collaborate to win ❑Fast is better than perfect ❑”Malasakit”  TYPES OF PLANNING ACCORDING TO LEVEL OF MANAGEMENT TYPES OF PLAN LEVEL OF MANAGEMENT Strategic planning Top level management Tactical planning Middle level management Primary /Operational planning First level management  TYPES OF PLANNING STRATEGIC PLANNING – concerned with the entire organization. It reflects the broad over all concepts of an enterprise operation. It begins with the organization’s mission. Strategy – is the method of shaping a company’s future and involves determining the long- run direction of the organization. It outlines the basic steps and management intends to do to achieve its objectives.  TYPES OF PLANNING TACTICAL PLANS - are the means to achieve a strategy , to activate it and make it works. ‘”The whole” is the STRATEGY , which is made up of a series of tactical plans ; built of a series of tactical lanes built on each other to achieve the strategic plans. Strategic planning activities Tactical planning activities Choosing company planned targets Formulating budgets Planning the organization Planning the staff line Setting personnel policies Formulating personnel policies Setting financial policies Working capital procedures Setting marketing policies  TYPES OF PLANNING OPERATING PLAN – is one that a manager uses to accomplish his job responsibilities. It can be a single use plan or an ongoing plan. Type of operating plans Examples 1.Single use plan Program, budget 2. Ongoing plan Policy , procedures, rules.  PROGRAM – is the actual course of action designed to carry out the established objectives. it can be easily and systematically shown using a project schedule and drawn it using a GANNT chart. Example : Marketing program, personnel program BUDGET – is a plan stated in financial terms. It is also called “ numberized program “ POLICY – is the basic guidelines for action. These are broad , general guides for action which constrain or direct objectives attainment. Example : Personnel Policy PROCEDURES – are the set of step – by step directions in which activities are to be carried out and expressed in chronological order for a specific purpose. RULES – specific plans for controlling human behavior and conduct at work. These are the do’s and don’ts statements. TYPES OF PLANNING ACCORDING TO RANGE OF PLANS SHORT RANGE PLANS – are plans for a short period of time , six months to one year. LONG RANGE PLANS – are plans for a long period of time , say 5 to 20 years. HOW MANAGEMENT GETS RESULTS Management by Objectives ( MBO) Management by Exceptions ( MBE) Management by Committees ( MBC) Total Quality Management ( TQM) MANAGEMENT BY OBJECTIVES (MBO) ▪Management by objectives (MBO) is a strategic management model that aims to improve the performance of an organization by clearly defining objectives that are agreed to by both management and employees. ▪According to the theory, having a say in goal setting and action plans encourages participation and commitment among employees, as well as aligning objectives across the organization. ▪In this approach , the boss and the subordinates function as a team in setting objectives and accomplishing these objectives through cooperation. ▪For example , if you work in customer service , your goals could be to increase customer satisfaction by 13% and reduce customer call times by two minutes. Once you have created your goals , you need to develop objectives or steps to achieve. MANAGEMENT BY EXCEPTION (MBE) ❑ Management by exception (MBE) is a practice where only significant deviations from budget or plan are brought to the attention of management. The idea behind it is that management's attention will be focused only on those areas in need of action ❑ For example, the company controller may be required to notify management of those expenses that are the greater of $10,000 or 20% higher than expected. The purpose of the management by exception concept is to only bother management with the most important variances from the planned direction or results of the business MANAGEMENT BY COMMITTEE ( MBC) Management by Committee ( MBC) - a group of senior people who take decisions about how a company , or part of a company , is managed : The Group Management Committee is where all the decisions regarding the direction, strategy and financing of the group are made. The number of people who serve on a management committee varies from organisation to organisation but typically the number is between 6-10 people. TOTAL QUALITY MANAGEMENT (TQM) Total quality management (TQM) refers to the quest of quality in an organization. It is a philosophy that involves everyone in an organization in a continual effort to improve quality and achieve customer satisfaction. A management system to utilizing all resources to provide continuous customer satisfaction. Is a management approach that originated in the 1950’s and has steadily become popular since the early 1980’s.- a comprehensive and structured approach to organizational management that seeks to improve quality of products and service through ongoing refinements in response to continuous feedback.  Isa management strategy aimed at embedding awareness of quality in all organizational processes. It has been widely used in manufacturing , education, government , and service industries ,as well as NASA space and science programs. TQM is an approach to achieve operational excellence. Objective of TQM : Continuous Improvement Principles of TQM: ✓customer Focus ✓process improvement ✓total involvement